The Rockin Johnny B

Sunday, July 10, 2011


I thought I'd say a couple-a words about jobs.  I think it's imperative that we realize that jobs are directly hooked into the country's fiscal well-being.  When we are in boom times, the jobs are there...plenty of them.  When we are in dire straits, the jobs are not there because employers don't hire because they are afraid they cannot afford the extra help with an economy that's tanking.  Having said this, how do we get out of this dilemma?

First of all, it is a fact that one cannot get ahead when dealing with life from a position of fear.  Roosevelt said it best: "All we have to fear is fear itself."  Psychologists/Psychiatrists have been espousing this fact ever since Freud defined the ego/superego.  How does this affect the economy.  Simple.  I don't buy that new Chevy if I am worried about having a job in the near future.

But, let's say someone gave me say $1000.00.  Now, I start thinking I might just buy me that new Chevy cause I got the downer.  Now the Chevy dealer has to hire more people cause me and a whole bunch more of me have just gotten $1000.00 and can afford that new Chevy.  Now the Chevy division of GM hires more people to make more Chevy cars.  This is simply "Demand Side" economics.

The other side of this coin -- Supply Side Economics, says we make a whole bunch of Chevy cars and people will buy them cause there is a supply to buy from.  But, the problem here, in this economy, is people are worried about their jobs, so they won't buy that new Chevy cause they don't feel like they can afford the downer.  Even if they can afford the downer, fear keeps 'em from digging into that savings account for the $1000.00.  So the Chevy factory lays off people.  The Chevy dealership lays off sales people and mechanics and they draw unemployment which drains the economy further.

Now, let us say when Obama gave us the piddling little economic bump, but bailed out the banks to the tune of trillions of dollars, let's say the President sent all of us a check for $10,000.00 to anyone who earns less than $150,000 per year.  What do you think might happen?  Do you think there would be a lot of demand for goods created from that increase in the national coffers?  Hmmm.

Roosevelt, in the middle of the worst depression this country [and every other country included] was in, he created jobs by creating places to pay people to work.  There was a whole alphabet soup of government project headings: The CCC, TVA, etc.  People were working again and people were spending again and the economy rebounded.  Amazing!  When you put money into the economy, the economy rebounds!  Why?

By giving people money to spend, demand for goods was established and businesses were hired and new businesses were started in order to snag some of that new money.

Demand Side Economics works, Supply Side [Reaganomics] does not work.  Giving money to the rich in the form of tax advantages does not work.  The rich do not spend, THAT'S WHY THEY ARE RICH.  They invest instead.  Give a rich man money, he will find a way for that money to make money.  The easiest way to do that is invest it.  Give a poor man money and he will spend it for, if nothing else, food, clothing and shelter thereby enhancing the economy.

The reason we are in the pickle we're in right now is that the Republicans still believe Reagan Voodoo economics actually works.  Yet, every time we have a Republican in the White House, we go into a recession.  When will we ever get it?

No comments:

Post a Comment