Economically "Stated"

I've got a burr in my britches that just won't go away. There is a looming problem facing America and it's economy, and I feel it's not being addressed. Washington put the jobs recovery act into effect, the stimulus plan that was designed to get America back to work and keep unemployment at 8%. Now everyone is aware unemployment is at 10% but with the rhetoric coming out of Washington I just don't feel they have a grasp on how dire this situation is. Let's look a little closer.....

First of all only a third of that money has been used, and it was designed to create shovel ready jobs to repair America's infrastructure. We are often told that money has saved or created 3 million jobs, a number no one can verify or even explain where they come up with it from, but I digress, on to my concern. Truth be told that money was used to brace up state economies so they didn't have to lay off teachers, firemen, police officers, and other state workers. President Obama is often heard touting how X number of police or firemen are on the street due to the recovery act. Here is the problem.....

Since there hasn't been a job recovery in the private sector, (non government jobs, you know the ones that actually produce profit), states have reported a double digit shortfall of tax revenues, (over 10%), for three quarters straight. No income, no taxes to collect! So not only haven't the states collected enough money to pay these newly created or "saved" government jobs, They are lacking the funds to employ another 10% of their work force, so those artificially "saved or created" jobs are in jeopardy of being lost, as well as others.

Now states don't have the ability to print or create money out of thin air like their counterparts in Washington, so they have to let people go they can't afford to pay. The other option is to use the California method and tell Washington they need money to cover the fiscal shortfall in their budget. So we are facing the possibility of those artificially saved government jobs going away or another infusion of our tax dollars to hold those jobs for yet another year, it's a giant ponzi scheme destined to fail.It's why economists are predicting an increase of the unemployment figures to 10.8%.

`While there is a need for teachers, firemen, and police officers, there is a bigger need for profit creating, private sector jobs to finance those positions with their tax dollars. The government can't support itself, it's not a profit generating entity. Right now it's like you hire yourself, and pay you, out of your savings, sooner or later your expenses are going to eat up the piggy bank because there is no new money introduced to that piggy bank. It didn't work for Bernie Madoff, it won't work for the government.

The whole thing also sets off bells and whistles because all those government jobs are union. It's no secret the Obama administration has a doting love affair with union support. The unions mobilized to support this administration's campaign bid, and were a big factor in the election. It reeks of payback. It doesn't take a PHD in economics to realize unionized, government jobs are not self supporting, and a poor choice for long term job creation. So I'd like to know why was the focus placed there?

Here is where the naive point out how we are going to jump start this economy with "green jobs." Really? If your banking on an industry that has to be "forced" on the population, your gonna get your feelings hurt. If green technology was affordable and feasible the consumers would have created a need for it already. Let's face it when I buy a car economy is one of the biggest factors I consider, but so is price. I'd love to drive a car that gets 100 MPG, but not at a Ferrari price tag. There would be a windmill in my back yard, if it was affordable, reliable, and there wasn't an ordinance against it. I'd have solar panels on my roof if was cost effective. IT'S NOT! And forcing the consumers into using green technology through taxes on energy is no way to inspire long term industry, but it is a way to get voted out of office. I'm not even going to point out those jobs created by the new technology will be shipped overseas where it'll be more cost effective to manufacture the equipment needed. That's for another blog!

So are we being "shammed", or are those who make these decisions that naive? I submit it's a combination of the two. We have officials with no free market experience, dabbling in theory learned from others with no free market experience, and taking input from special interests with an agenda. Not a good combination. Keep a careful eye on the state economies. The largest three are bankrupt, it's not a coincidence they've been led by liberals for decades. California, New York, and New Jersey, all deep in the red. Then there is Texas, run by fiscal conservatives for decades, in the black with a surplus. Hey, I'm just saying................

God Bless
Capt. Bill