The Unofficial Turley Blog Job Creation Plan

Respectfully Submitted by Lawrence Rafferty-Guest Blogger

We have heard both sides of the aisle claim that they have the next big idea to bring jobs back to Main Street. Recently President Obama, according to an article from former Labor Secretary Robert Reich, has claimed that he will be submitting a Jobs Bill to Congress when they return from their 5 week summer hiatus.  “He even says he’ll be proposing a jobs bill in September – and if Republicans don’t go along he’ll fight for it through Election Day (or beyond).  That’s a start. But read the small print and all he’s talked about so far is extending the payroll tax cut and unemployment benefits (good, but small potatoes), ratifying the Columbia and South Korea free trade agreements (not necessarily a job-creating move), and creating an infrastructure bank.  An infrastructure bank might be helpful, depending on its size.  Which is the real question hovering over the entire putative jobs bill – its size.  Some of the President’s political advisors have been pushing for small-bore initiatives that they believe might have a chance of getting through the Republican just-say-no House. They also figure policy miniatures won’t give aspiring GOP candidates more ammunition to tar Obama as a big-government liberal.

But the President is sounding as if he’s rejected their advice.  That’s good policy and good politics.Good policy because any jobs bill has to be big enough to give the economy the boost it needs to get out of the gravitational pull of the Great Recession.” Truthout   According to Reich and other economists, the legislation needs to be big and bold.  Secretary Reich goes even further and presents a list of ten ideas he would like to see in any job legislation.

“What would a bold jobs bill look like? Here are the ten components I’d recommend (apologies to those of you who have read some of these before):  1. Exempt first $20K of income from payroll taxes for two years. Make up shortfall by raising ceiling on income subject to payroll taxes.

2. Recreate the WPA and Civilian Conservation Corps to put long-term unemployed directly to work.

3. Create an infrastructure bank authorized to borrow $300 billion a year to repair and upgrade the nation’s roads, bridges, ports, airports, school buildings, and water and sewer systems.

4. Amend bankruptcy laws to allow distressed homeowners to declare bankruptcy on their primary residence, so they can reorganize their mortgage loans.

5. Allow distressed homeowners to sell a portion of their mortgages to the FHA, which would take a proportionate share of any upside gains when the homes are sold.

6. Provide tax incentive to employers who create net new jobs ($2,500 deduction for every net new job created).

7. Make low-interest loans to cash-starved states and cities, so they don’t have to lay off teachers, fire fighters, police officers, and reduce other critical public services.

8. Provide partial unemployment benefits to people who have lost part-time jobs.

9. Enlarge and expand the Earned Income Tax Credit – a wage subsidy for low-wage work.

10. Impose a “severance fee” on any large business that lays off an American worker and outsources the job abroad.” Truthout

While I may agree with some of Sec. Reich’s suggestions, there are others that I don’t like.  For example, I like number 10 on his list.  I think the idea of the “severance fee”  would act as an inducement to big companies to keep jobs here in the States.  I don’t like the idea of an infrastructure “bank” because I would be afraid that some ex-Goldman Sachs big shot would be named to run it and I think we know who that would benefit!

However, since we have so many good minds here on Professor Turley’s blog, I am confident that together We can come up with ideas to jump-start the job creation process that will compliment the ideas already mentioned or actually replace those ideas. My big idea would be to challenge the corporations of America to create jobs through innovation and new technologies and provide the funds to develop the best of those innovations as quickly as possible through a national competition that would be open to corporations and individuals alike.  The winning entry would have to be one that would produce significant, good paying jobs and would have to be designed and manufactured here in the United States with 85% of the materials also obtained or produced here in the United States.

So it is time to get to work and let us know what you think of these suggested ideas from Robert Reich, but more importantly, let us have your idea(s) and why it would work.  Don’t be afraid to think big.  We don’t have the political restraints here that Washington has so there is no excuse not to be bold in your ideas.  Who knows, maybe President Obama and Speaker Boehner are secret readers of the Turley Blog and your ideas just might catch their eye!

Respectfully submitted by Lawrence Rafferty-Guest Blogger

66 thoughts on “The Unofficial Turley Blog Job Creation Plan”

  1. Roco,

    Did you think I was referring to you as kind of a rabid football fan believing my team right or wrong? Why is that?

  2. Mike Spindell:

    I dont see Gyges offering any analysis of the report he posted. Why should I?

    If he likes the report let him say why and I will respond to it.

    The report does mention family cohesion as important to future success. I agree with that conclusion.

    But let Gyges give me his thoughts on his source and then I can respond.

    By the way, do you have a point?

  3. As a rabid NY Jets fan I once read a study that said that the NY Giants had a longer history and had won more important games than the Jets. I briefly read through and saw a great deal I disagree with. The Jets have a nicer name. They did win the Super Bowl in 1969. Most importantly I love them! I don’t need no stupid reports, my mind is made up already and nothing will change it. By the way our new quarterback John Galt is a superman.

  4. Gyges:

    So tell me about the study and what you think it says. It appears to be a tad bit more complicated than mixed economies. The US is certainly a mixed economy.

  5. Roco,

    None of which has anything to do with the fact that, unless you find fault with the methodology of this study:, there’s more economic mobility in France, Germany, Sweden, Canada, Finland, Norway, and Denmark ALL have higher economic mobility than the U.S.

    Unless you think their mixed economies are less socialist than ours, that doesn’t sit well with your claim.

  6. Roco,


    “did you know that a very high percentage of infrastructure is privately held?”

    Can you be more specific? What is the percentage of infrastructure that is privately held? Is it doing better than the infrastructure that isn’t privately held? Can you provide examples?

  7. Gyges:

    thanks for the link. I briefly read through and saw a great deal I disagree with.

    But one thing for sure is that America is a mixed economy and therefore I would predict intergenerational income stasis.

    The other thing I saw was about mature economies. In a dynamic economy there is never maturity, new technologies are being developed and brought to market all the time. TV, the transistor, the micro-chip, PC’s, the internet, etc.

    Railroads were the big thing in the 19th century, then air lines. Many fortunes were made and lost in all of those industries mentioned.

    I would say the biggest predictor of wealth is your willingness to take risks. Many super wealthy people came from solidly middle class families and so did many poor people in the 19th century.

    I could go on but dont have the time to point out all of the problems with that study.

  8. Gyges,

    “A productive civil job is one which results in a net gain in the quality of life for other members of society, or leads to an increase in knowledge.”

    What tools to do you use to measure individual utility or satisfaction?

    “For instance, if one job is that of a literal slave driver and the results of the slave labor somehow improves the lot of everyone else enough to overcome the decrease in quality of life for the salves, that fits my definition of a productive government job”

    Im going to preface this by saying im not trying to insult you by suggesting that you actually advocate this, however i see several problems with your perspective on this.

    Your judgement (not right or wrong, but whether it was productive) rested only on the condition that the work the slaves were put to would somehow overtake the loss of production that would have occured had they been simply allowed to act of their own free will, instead of having it redirected. In your scenario, that job can NEVER be productive, simply because the loss of individual initiative and decision making will never be to overtake the productivity possible had those slaves been allowed to act freely. With no knowledge of their individual preferences, talents, and affectations, there is no information as to what ends of their own choosing their labor could have been set to. Not only that but you also must factor in the lost production of the slavedriver himself, who when confronted with a population free to choose their own actions, is himself unemployed and therefore free to set his labor to his own choosing, rather than expend it directing labor to go where it does not want to be.

  9. Roco,

    Hey, remember that time I linked to the report that showed that you’re wrong about the economic mobility in the U.S. compared to socialist countries? Because I do.

    Figure 3 three’s the relevant one.

    Oh and, just so everybody knows…

    “The Economic Mobility Project is a unique nonpartisan collaborative effort of The Pew Charitable Trusts and respected thinkers from four leading policy institutes — The American Enterprise Institute, The Brookings Institution, The Heritage Foundation and The Urban Institute. While as individuals they may not necessarily agree on the solutions or policy prescriptions for action, each believes that economic mobility plays a central role in defining the American experience and that more attention must be paid to understanding the status and health of the
    American Dream.”

  10. ekeyra:

    good video. economic mobility is important and is limited in socialist countries. In fact socialism promotes a wealthy class and preserves the status quo.

    The best way to limit the power of rich people is to have a dynamic economic system where the rich need to really keep their wits to keep their money.

  11. “Sustainable employment can only be accomplished by mixing labor with capital goods toward production processes that are based on consumer valuations. Improvement in the labor market, therefore, is unquestionably tied to the capital structure. Without a structural readjustment, there can hardly be a sustainable or economical reduction of unemployment.

    This structural readjustment is the Austrian “recommendation” of what needs to occur to restore healthy productivity to an economy. There are two main components: a correction in the pricing process and a readjustment in the capital structure. Whether these would be “unfair” or “painful,” frankly, does not matter. Rather than blaming the readjustment, guilt should be associated with the interventions that made the liquidation and restructuring necessary in the first place — the inflationary policies that led to the depression. Any step taken to avoid the readjustment will at best prolong the recession, or at worst aggravate the problem.”

  12. Ekerya,

    Off the top of my head: A productive civil job is one which results in a net gain in the quality of life for other members of society, or leads to an increase in knowledge.

    Of course, you and I will probably disagree about what actually improves the quality of life. Also, not all productive jobs are jobs I believe the government should do. For instance, if one job is that of a literal slave driver and the results of the slave labor somehow improves the lot of everyone else enough to overcome the decrease in quality of life for the salves, that fits my definition of a productive government job, but that is obviously not something I would like the government to employ something to do.

  13. Gyges,

    Just out curiosity, what criteria do you use to determine what is a productive government job and what is not a productive government job?

  14. Gyges:

    That is the attitude people take and are taking right now in regards to stimulus-if X is not enough then X^10 must be even better.

    And the point is government spending is not part of the solution, it isnt a solution.

  15. Gyges:

    I am sorry I ruined your joke, but I did understand it if that is any consolation and I did laugh.

  16. Ekerya,

    “If the government can create productive jobs, why not just draft everyone into the military. Problem solved right?”

    If Great Divide Brewery can create productive jobs, why not just employee the entire city of Denver in the brewery? Problem solved right?

    If my garden can grow fresh vegetables, why not just use it to grow all my food? Problem Solved, right?

    If selling stuff at a garage sale can bring in some income, why not just sell stuff at garage sales for a living? Problem solved, right?

    If the water from The Platte can provide for the needs of Highland’s Ranch, why not just use it for drinking water for everyone? Problem solved, right?

    If cheddar and ale can be one meal, why not just eat that all the time? Problem solved right?

    Just because something doesn’t solve a problem completely doesn’t mean it isn’t part of the solution.

  17. Dont you guys ever wonder why you have to take people’s money by force to make them pay for something you have decided is in their best interest? Yet if they perceived it as being in their best interest, you wouldnt have to force them to pay for it. So obviously there is a disagreement, but you just assume you know better than they do. Im just wondering if you’ve ever sat down and considered why you think the government knows better how to live their lives then they do?

  18. If the government can create productive jobs, why not just draft everyone into the military. Problem solved right?

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