The focus of all candidate speeches these days is job creation: How is the next or current president going to create jobs for Americans? We need to hear from them what they can actually do to create a job. The last time I looked, presidents and governors don’t create jobs except in their own cabinets. They can also take away some of those jobs, too. That may be the difference between a Republican and a Democrat, though you would be hard pressed to define one or the other based on the size of the workforce directly reporting to the White House since both parties seem to increase the number of people working there over time.
What we are all interested in is how is the government actually going to get an actual business owner to pony up and provide a job, one with health care, benefits, and, most importantly, a salary sufficient to support a family. I think we all would love to hear him or her tell us that those “bubble years” of early in the decade were representative of the actual earning power of all people in the United States and the World, but if we were honest with ourselves, we’d realize that it was so much smoke and mirrors. Bernie Maidoff was an illusion. Your house really wasn’t worth three-quarters of a million dollars. You can’t afford to drive a Mercedes on a Retail salary. Your kid can’t go to an Ivy League school without having huge loans.
In case you haven’t talked to someone lately who could provide a job for you or a friend, ask one. They’ll probably tell you that taxes are high, unemployment insurance is high, there is too much uncertainty in their sales, in the value of the dollar, there are too many regulations that actually cost them money. Many of those things make them more than cautious at providing another person a job. They may even tell you truthfully that they can increase their business almost at will, but that too makes them wary of providing someone else a job for some reason. Only some of this is true, but their perception is very real. And therein lies the rub.
I want to know from the president, governors, and congressmen and women running for that office–we all do–how to prod that small business owner to hire just one more person at a decent salary with benefits, including health care. I am pretty sure that providing longer unemployment insurance to those already out of work will make him more scared–it directly affects him when he hires someone who doesn’t work out and it makes him pay more for those he may have laid off in the past.
I am pretty sure that bailing out Detroit or Wall Street won’t make him hire anyone–that is what he is angry about. Indirectly, it costs him more. Those bailouts actuall saved the Financial system we all depend on, but that really doesn’t matter to our small business owner or entrepreneur.
You know what might do the trick though? If gas prices went back down to $2.50 per gallon and stayed there for about a year. I am pretty sure that would help all business owners and the rest of us who drive cars, too. It would definitely help the price of food. It would put a dent in the profits of the Oil industry, but a gradual shift downward would make that all right for them, too. Remember they have little incentive to reinvest those huge profits so long as a short supply keeps the price up, no matter how many tax breaks we give them for drilling.
By this point, you might be wondering what it is the president can actually do to create jobs, since it was the point of this essay. Actually, I think the answer is “Not much”. Both George Bush and Barack Obama did what they could when they saw the Financial Industry about to fail. They put money into the system through the Federal Reserve. This is exactly what J.P.Morgan did over 100 years ago when these types of things happened many times at the beginning of the 20th century. That is how he eventually sat on the Board of many Railroads and US Steel amongst others. Now we do it through the Federal Reserve system. That single act that many think of as a “bailout” kept money flowing in the system and is still doing so today. It also kept Americans and others around the world from experiencing a total failure of the financial system. That would have been a world far worse than the one we experience today. No, the president really doesn’t create jobs. He is just somehow made responsible for them when we are out of work and our standard of living is lower than it used to be.