I like this article, basically because of what it does not do. All political language and some economic terminology changes with the regime change. Opposition parties become deficit hawks unless the passed legislation is of direct benefit to themselves. Administration parties proclaim a Brave New World, and announce great new political slush funds. No one expects the slightest change to occur, and get almost manic when any does. Yet everyone would react with horror if We ever returned to the fabled reduced Government of our Great-Grandfathers. Politics make such strange bedfellows as well: Ben Bernanke would adopt the tight monetary policy of some of his predecessors who he had spent much of his life castigating, while at the same time trying to make people think he is spending like Johnson’s Great Leap Forward–wait, that was Great Society–they mix metaphors while I mix Countries. Tyler Cowen obviously perceives the irony in all this hype, knowing Monday morning will be Business As Usual.
I disagree with James Hamilton’s position on Unemployment, but his Post is too intrinsically sound to avoid. Labor Turnover has become a national and international fact, ever since Business turned to Project Hiring. It was Business, and not Labor, which turned away from career employment. Business wanted to cut Operational Costs like contributions to health care and retirement funds. They wanted a Shift to limited liability towards their Workers, and insisted that Labor absorb all the natural Costs of unemployment. Do not think their claims of paying excess Taxation for Unemployment Insurance has validity in fact; the truth being that they cause the ordinary Taxpayer to absorb such Cost–through Taxation, raised Pricing of their own Product, and shoving all placement Costs of new employment off on the Worker. James does not differentiate between Taxes and Tax reportage, which he should because the Tax reportage Costs equally with Safety Reportage is so high in Price; remember, that if Business lobbyists would allow revision of the Tax Code for simplicity and clarity, then such Costs of all types could be cut probably 70%. Study the Chart listed, and one can find that most of the delivered Cost could be avoided by regular Business compliance with law and regulation.
My basic Statement on the above issue stands that Business loses its cherished Profits early from a lack of Consumer Demand, and would blame everyone but themselves. Consumer access to Credit has become so convoluted that Demand had to drop; this intricacy all coming from Business trying to draw the same Profits from a smaller financial pool. Business is dropping their Labor the second their Work is done, without any attempt to shift Labor elsewhere and be as relatively effective; this continual Job loss drain accrued assets from Households. Business could avoid much of their Tax compliance Costs, if they chose to forego the complexity of available and obscure Tax breaks which they insist remain on the Books. Safety Compliance Costs could be equally reduced, if they simply devoted as much Capital to renovation as the Regulations call forth. Business always finds someone to blame, but they create their own troubles. lgl