By David Nicholas -Future Voices
“Make no mistake, we are headed in the right direction” -President Obama 7.2.10
During the 2008 Presidential campaign, then democratic frontrunner Barack Obama said job losses were “un-American.” He gave the American people hope. Americans were tired, upset, frustrated with 6.5% unemployment and looking to the new democratic leadership to provide relief.
I ask the question, where are the jobs?
- $862 billion American Recovery and Reinvestment Act -2009
- 3 Million jobs lost since Recovery and Reinvestment Act
- 125,000 jobs lost -June 2010
- 131,000 jobs lost -July 2010
- $26 Billion stimulus for cash strapped states -8.10.2010
Fast forward 22 months, 9.5% unemployment and a trillion dollars more in debt, the pain is unescapable.
$26 Billion in aid was passed tuesday to help the states. Backers of the $26 billion measure, which passed the House of Representatives by a vote of 247 to 161 on a largely party-line vote, say that states deserve extra financial support amid a cash shortage. The whole premise behind the stimulus is that it will reduce the number of state-employee layoffs.
Amid the recession, private sector incomes have dropped to historic lows. Is anyone surprised? In the free market, incomes will adjust with the demand for goods and services. It’s really simple: If people buy less, prices for goods and services will come down. If people start to buy more, prices for goods and services will go up, and therefore income will increase. It’s first grade supply and demand.
USA TODAY reported that Paychecks from private business have shrunk to their smallest share of personal income in U.S. history . At the same time, government-provided benefits from Social Security, unemployment insurance, food stamps and other programs rose to a record high during the first three months of 2010.
Last week President Obama was applauded for ordering a freeze on bonuses for 2,900 political appointees, but for the rest of the 2 million person federal workforce, Obama asked for a 1.4% across-the-board pay hike in 2011.
Let’s recap. Private sector: incomes down. Public sector: incomes up. How can this be? Well I guess Washington doesn’t exactly play by the rules of the free market. It doesn’t have too. A great example is shown in how private school teachers on average are paid dramatically less than their public school counterparts. There used to be a day that when you got a job for the government, you were ok with getting paid less than the private sector because you were doing your “civil service.” Not today.
What does the data show:
- Federal workers received average benefits worth $41,791 in 2009. Most of this was the government’s contribution to pensions. Employees contributed an additional $10,569.
- The average federal salary has grown 33% faster than inflation since 2000. USA TODAY reported in March that the federal government pays an average of 20% more than private firms for comparable occupations.
- Federal compensation has grown 36.9% since 2000 after adjusting for inflation, compared with 8.8% for private workers.
Does Government provide jobs? Sure. Can the private sector do better? Yes.
Let’s take look at Bill Gates and the little company he started called Microsoft:
Number of employes: 89,000
How many billionaires did it create? 4
How many millionaires did it create? 12,000
How much has Bill Gates given to charity? $28 Billion
“Growth, prosperity and ultimately human fulfillment, are created from the bottom up, not the government down. Only when the human spirit is allowed to invent and create, only when individuals are given a personal stake in deciding economic policies and benefitting from their success — only then can societies remain economically alive, dynamic, progressive, and free. Trust the people. This is the one irrefutable lesson of the entire postwar period contradicting the notion that rigid government controls are essential to economic development.” -Ronald Reagan
We desperately need this mindset back in Washington, and when that begins to happen, the days of asking: “where are the jobs?” will quickly come to an end. There is nothing wrong with America that the faith, love of freedom, intelligence and energy of her citizens cannot cure.