Monday, November 08, 2010

Pounding in the Nail with a Gunbutt!

Kevin Warsh is a good man, and has much of the right idea, though I worry seriously at Those who fear Deflation. No one has yet proven to myself that you cannot have productivity without Inflation. I know that one cannot achieve Productivity without relatively full employment and equivalent Consumption levels. It is here that I got a bright idea, which might seem old and brittle to Others. It is the Concept that We make all Tax Cuts conditional on performance. Does this seem outrageous to you? You might want to join the Conservatives.

Here starts the real difficulty: how to make the Tax Cuts conditional; and how to insist on performance. The Bush Tax Cuts are about to run out, and can be readily changed; at least stopped until the Conservatives agree to amendment. It is not the best way to discuss legislation, but one has to recognize the structure of Washington D.C. today. Now is the time to throw a sea anchor into the Water, and get some vital Concessions.

My pet idea just dreamed up is to make all such Tax Cuts conditional with the employment of 5% of businesses labor force as Apprenticeships. They will have to be paid a minimum of the Minimum Wage or more. They must be employed for 2000 hours per year, and test out by Government testing with a minimum Grade of 70 at year’s end to qualify the individual business for all additional Tax Cuts that Congress may pass or extend. The program does many things which are beneficial: it trains future labor in production detail; provides labor with an alternate to Unemployment Benefits when they run out; ensure that a far greater number maintain at least minimum participation in Consumption; and makes sure that far fewer labor cadres lose their edge in production operation. Business, on the other hand, will face a different set of limitations: they will need to find the most qualified as they need to get these Apprentices to test out positively; they must fulfil their function as Educators to get positive Results; get a trained labor force for potential expansion, and can write off their Training Costs as Expenses.

Business has the ability to tell Apprentices "Sorry, there is no followup Job" when conditions warrant, and simply hire new Trainees. Failed Apprenticeships can simply apply for Apprenticeship with another business, most likely in an related area. All businesses improve their Hiring sequence and practice, and all Labor get a firm grounding and foundation to later accept employment. I like the idea, and probably no one else will. Such is Life! lgl

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