Lecture 26. JOBS, JOBS, JOBS

The deficit hawks will tell you that government can’t
create jobs. False! Government is involved in the
employment of everyone who works in any connection
whatsoever with the transportation, communication, energy,
water, health, education, and other industries.
 
And that is only on the primary level.  All of the above
workers buy goods and services, thus creating secondary
and tertiary jobs that cascade throughout the economy.

What the deficit hawks really mean to say is,
Government cannot create new jobs.  That would be
true - unless government creates new infrastructure
or repairs, rebuilds, or renews existing infrastructure.

Indeed, much of our difficulty today stems from our
failure to properly maintain and add to existing 
infrastructure.

There was a time in our history when stimulus was not
a dirty word.  In 1956, the debt from WW II was still a 
burden.  Top income tax rates were over 90%.  The nation
was re-arming against a nuclear threat in a perilous world.
  
Yet, President Dwight Eisenhower, a Republican, signed the 
Interstate Highway System Act, a bill passed by a large 
majority of a bipartisan Congress despite its enormous cost.

Somehow, there were no tea parties claiming that
government cannot create jobs, opposing a federal 
government that was too big, protesting that 
Washington is threatening our liberty, complaining
that the administration is shoving this down our 
throats, and crying that President Eisenhower was 
trying to do too much, too soon and should rather 
concentrate on jobs, jobs, jobs.

Instead, there was a nation of war veterans tested in battle,
of factory workers accustomed to double shifts, and of
farmers who had stopped work only to eat and sleep.  It was
an ambitious nation ready, when asked, to go to the moon.

What happened to that America?
  How did we lose our courage?
WHAT IS TO BE DONE?
Today, we have failing schools, flooded homes, and an 
internet crying for bandwidth.  With modern trains, we could
reduce long-haul trucking and short-haul flights.

Some economists will show you a cost/benefit analysis that 
claims little "pay-back" for these investments. But they do
not take into account that idle workers cost almost as much 
as employed workers. Their families must be fed, clothed,
housed, educated, and medicated. In effect, from the 
standpoint of society, labor cost is practically constant.

We pay for it whether we use it or not. And since, except for 
capital costs, all costs are ultimately labor costs, the
only serious questions are needs and resources to satisfy
needs.

Now, ask yourself: Two or three hundred years in the future, 
will our freight trains still be moving at 60 miles per hour? 
No, the world will be different. The only question is: are we 
going to be the first in everything? — or the last?
GREEN JOBS
To achieve energy independence and get our forces out of the
Middle-East, to prevent global warming and stop carbon 
pollution, we need solar panels, windmills, geothermal wells, 
and nuclear power plants.

The deficit hawks will tell you that green jobs are a 
fantasy, that if carbon-free energy were economically 
feasible, free enterprise would be doing it.  Yet, nuclear 
power plants are the source of 80% of the energy needs of 
France.  And they are planning toward 100% for the next 
generation, when all cars and trucks and trains will be 
electric.  Are they more capable than we?

The Center for Progress lists ten reasons why green jobs
are vital to the economy.

In his book, "The Third Industrial Revolution", Jeremy
Rifkin describes the future for which we must work:

  "Like every other communication and energy
   infrastructure in history, the various pillars of a
   Third Industrial Revolution must be laid down
   simultaneously or the foundation will not hold. That's
   because each pillar can only function in relationship to
   the others. The five pillars of the Third Industrial
   Revolution are:
  
   (1) shifting to renewable energy;
   (2) transforming the building stock of every continent
       into micro-power plants to collect renewable energies
       on-site;
   (3) deploying hydrogen and other storage technologies in
       every building and throughout the infrastructure to
       store intermittent energies;
   (4) using Internet technology to transform the power grid
       of every continent into an energy-sharing intergrid
       that acts just like the Internet (when millions of
       buildings are generating a small amount of energy
       locally, on-site, they can sell surplus back to the
       grid and share electricity with their continental
       neighbors); and
   (5) transitioning the transport fleet to electric plug-in
       and fuel cell vehicles that can buy and sell
       electricity on a smart, continental, interactive
       power grid.
 
Are we going to be first to create that future? or last?

According to the American Society of Civil Engineers, "More
than 26%, or one in four, of the nation's bridges is either
structurally deficient or functionally obsolete."  One-third
of America's major roads are "in poor or mediocre condition 
and 45 percent of major urban highways are congested."

Its drinking water systems "face an annual shortfall of at
least $11 billion to replace aging facilities." Inland 
waterways, wastewater systems, levees rate a "D" or lower
according the Civil Engineers' report card.

Because lost time cannot be regained, a huge, irrecoverable
loss of national wealth results from disuse of our vast
resources.   Each day, we rob our children of their just
inheritance.

Yet, much of our construction industry is sitting by the
telephone, waiting for a call that never comes.

Stimulus works!  And the larger the stimulus, the sooner we 
will break out of gridlock, which is mainly due to a mass 
psychology of fear.  The public must believe that the 
government will spend enough to restore prosperity.  As 
workers find work and spend more, producers will produce and 
hire more: an upward spiral.  As fear subsides, gridlock will
end, prosperity will begin, and we will catch up with other 
nations.

Using idle resources to build useful infrastructure, stimuli 
will end the recession, increase the GDP, reduce the DR,
please our bond-holders, let us outgrow our debt, increase our
productivity, enrich our nation, "promote the general 
Welfare and secure the Blessings of Liberty to ourselves and 
our Posterity".

When the Founding Liberals wrote those words, they were 
thinking about our children.

We should all be doing that now.
Thanks for your interest.
  Marvin Sussman, retired engineer

If you don’t like the world as it is, change it this way!: 
1. Depress the Shift Key,
    sweep the cursor over the following URL,
    click, copy, and paste it on email to friends,
    and ask them to do the same:

     Keynesian Economics 101
     The ONLY way out of this mess     
     Free lectures on-line:
     KeynesForum.blogspot.com
2. To print and distribute single-sheet “invitations”
 to  this site, click here
 and ask your friends to do the same. 
3. To donate toward advertising this website,
 click the yellow “Donate” button below.

You will be asked for your PayPal account password.
If you  don't have a PayPal account,
 you will need a credit card. 
    
And ask your friends to do the same. 
Copyright © 2011 Marvin Sussman All rights reserved.