Last Friday my good friend took me to a Scottish restaurant for dinner. The idea of a Scottish restaurant may seem like an oxymoron to most readers yet it is not a far-fetched concept if you live in the town where Jack Nicholas built his home golf club “Muirfield Village Golf Club.” All the streets circumventing the Golf Club are named after the streets in St. Andrews Scotland where the “Royal and Ancient Golf Club” is located. Here it is perfectly logical to find the appellation Scottish associated with a restaurant in keeping with the theme of the community. I ordered fish and chips for dinner with a glass of Killians.
My friend is a hale and hearty fellow well met and always the perfect host in social settings yet intensely laconic in business matters. Our conversations are always eclectic and cover every subject imaginable. As long as I have known my friend, he has neither expressed nor denoted any specific political philosophy that would indicate either a liberal or a conservative predisposition. If I were to identify the underlying principal that governs his worldview, it is pure reason.
Because my friend is a very successful businessman, he caught my attention when he said that he had a solution that would immediately reduce unemployment to virtually zero. Since President Obama called for a “Job Summit” I am publishing this innovative solution to expose it to the Socratic method and peer review. Your comments are encouraged.
THE SOLUTION:
If it is mandated that the hours worked by every American be reduced by approximately 10% or one hour per day without any reduction in weekly pay then all employers will have to hire 10% more people. Since labor makes up about 20% of costs, there would be only a 2% increase in the cost of production and a one time 2% increase in the inflation rate. We can compensate for imported goods by increasing customs duty by 2%, a small price to pay for entering our markets. The extra leisure time would allow workers more time to spend their meager earnings thus stimulating many sectors of the economy. With the extra time many workers would start a part time home based business thereby creating more wealth for this nation.
I submit this modest proposal for your comments.
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The Illusion of Choice
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What happens doesn't matter nearly as much as what you make it mean ... and
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5 comments:
Cool way to play the numbers. However, as we all know human nature, this is what would happen instead. Employers will not hire more people (that's the human nature part). Instead, workers who are not shift workers, will be asked to get more done in less time. Shift-type workers will close down an hour early and resume business as usual the next work shift. And if at all possible, the pressure will be to somehow catch up that extra hour by squeezing it into the others. Bottom line, employers won't fall for it! My opinion.
I think it is a clever proposal, and more modest that baby consumption. I see two ways to assess it: logistically and economically. I would have to give it some thought.
Interesting. However, how would other nations, especially within the WTO, react to our imposing tariffs? Would they respond with tariffs on American exports? If I recall correctly, tariffs caused additional hardships during the 30's.
unemployment is a side-effect of deflation and is not the cause. deflation is engendered by a debt-productivity imbalance. the imbalance can be sustained via wealth redistributionist policy so long as the losers in that situation cooperate. even in the perfect redistribution model deflation will still arise and require an economic reset.
D, I do not understand a "debt-productivity imbalance". Is this a debt ratio that takes a measure of productivity to the total issuance of debt? DC
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