Government Sponsored Jobs Program

Again? No thanks.

So a better place to start might be seeing how that same plan has actually done, something you've stridently avoiding doing.

And let's get real, we all know exactly who you are and it's obvious because all the clones make the same mistake.

There is no free lunch.

 

Well looking back, you claimed that hud grant application factories were made, but I can't find any reference to them online. What evidence do you have that they exist?

I haven't been avoiding it, when you mentioned it I read a few articles about these kind of subsidies and they say it does help unemployment. However they always neglect to mention the effect of taxes on the economy created by their plan, which I have solved here

What mistake am I making? I can prove I'm not a clone, I have a facebook that was created months ago!

 

Mike Munger of Duke wrote a blog on the topic: http://www.econlib.org/library/Columns/y2006/Mungerrentseeking.html

Where South Africa? That's the only positive outcome I've heard of and it's nothing like the US.

That there is not and will never be a free lunch.

 

Very informative blog entry, but this program doesn't have that problem. Nothing a business does helps them get a sponsored job other then say "yes" when asked if they want one, it's not a lottery in which whoever makes a thousand applications gets the grant, this is a lottery where each business gets one lottery ticket, and only if they are in the area of a sponsored jobs program and only if the government selects them to get a lottery ticket, and only if they can give a job that produces enough for the recruited worker to make a reasonable amount of money, or else he or she will just take the next available job that pays better.

Here

here

and here

So I'm a clone because I'm looking for a solution to unemployment like someone else and it doesn't exist?

 

Creating other distortionary taxes just to reduce the negative effects of your pet programme? Folly to the extreme.

You haven't understood the point. You're asking for 'ignorant' subsidies that will encourage abuse, as companies replace their training expenditures with public funds. It is nonsensical.

Its more than inefficient, its cretinous. There has been no understanding of the labour market. Trying to construct policy without that understanding is always going to lead to disaster.

 

Well first, if there is an increased demand for a good, Businesses increase work hours or hire more workers to produce that good, which both measures reduce poverty, so the poor benefit. Second, even if the first point fails, why can't it be fixed with progressive taxes?

Companies can't depend on this program to train their workers, they will be lucky to get 1 or 2, they can't abuse the system to pay for all their worker training.

Your not going to convince me that these are ignorant subsides without giving me a situation where they allow abuse, and if/when I find that abuse, I will find a solution for it!

So you are saying you have no understanding of the labor market? Because you're certainly aiding in its construction.

Well anyway I plan to find every case where this plan causes a negative effect on the economy and find a solution for it. If one negative effect is beyond mine or whoever else who helps with this plan's scope, it's just an unknown that can be found on small scale testing of this plan, like in one area (taxes will only be increased in that area to pay for the plan).

 

No there isn't. There's a distortionary policy that will therefore produce harmful demand effects. You haven't managed to achieve a workable employment subsidy policy.

There's no fix. There is a distortionary reaction to an original distortion. You're adding grief.

How do you know? You've constructed a whole policy based on ignorance over how companies behave. You have no means to control abuse.

The whole policy was destroyed in my original post. You're coming out with additional guff, nothing more.

I have merely been helpful in providing labour comment. That will hopefully lead you to improve your understanding and understand the folly of your original argument. Win win.

It isn't possible. You need to start with some validity first. You've been all sparky and hopeful with guff, then just added guff hoping that guff-guff looks sparkling. It doesn't. Remember the first thread: you need to learn some labour economics first. You'll realise the complexity involved in delivering workable policy and you'll tut at yourself

 

Why is all distortion bad?

The policy is based on the solutions to problems found in it. If everyone in government can't tell me an area where this policy can be abused, then we can just find it in testing. So why don't you give me a situation where this policy can be abused instead of insulting it?

You criticized that it would insentivize low skill labor, now it will be focused on manufacturing

you said there would be distortionary effects due to taxation, I responded to that only the new money added to the economy will be taxed. (and to add to it) If businesses don't spend it on employees, it gets put into a bank and loaned to someone else to make/expand their business and create jobs, so more distortionary taxes might not even be necessary.

You said We would need to understand the internal labor market of each industry, we can just use the private sector to figure that out. If there is room for abuse, give me the situation.

How are my arguments wrong?

 

Distortion refers to an inferior outcome, by definition. I'm not in a patient mood, so stop asking stupid questions.

No, its based on ignorance. You've started with drivel and, when told about that ignorance, you've stamped your foot. You apparently think that if someone stamps their foot less forcefully you've achieved something. You haven't. Go and learn!

 

I'm not convinced, but I think you don't want to continue this discussion, so I'll stop.

 

No, I was merely in a grumpy 'work inspired' mood. You do need to first try and study some labour economics. That will allow you to escape basic errors (given the labour market requires specific attention as standard economic models cannot be simply applied)

 

Ok, well let's start with the labor market, what negative effects on the labor market will happen if this plan was passed?

 

You're interfering with the market without suitable knowledge of its nature. At best that will means your plan is inefficient. At worst you will interfere with firm behaviour and generate long term negative effects (e.g. subsidising too much low wage labour, encouraging further a low skilled equilibrium)

 

What negative behaviors will be created?

What if this plan was also expanded to train workers to work in higher level jobs in their area (or move to an area where they can take a higher level job)? Also, replacing unemployment with low skill/wage jobs is still a good trade. Or are you saying that this plan will replace high skill jobs with low skill jobs by recruiting unemployed people for low skill jobs who would get hired for high skill jobs? Well this is countered by limiting recruitment to this program only when the market won't take in the current unemployed people and also by workers being able to look for better jobs while in the program.

What long term negative effects will be created?

I also want to know what you think of the core of this plan, which is using new (printed) currency to produce new goods and services. Does that solve the inflation problem if done perfectly? Will this create a positive net amount of jobs? Is this the economic loophole I think it is?

 

To the OP: There are several problems with your idea not the least is that I is more than possible to lose half your workforce and still increase your production. In fact that is almost precisely what has happened in manufacturing in the US over the last 75 years.

Other issues: It does not happen that the other 5000 will get the money that whole number used to get ergo what you usually get under the circumstances described is not inflation but deflation as between stocks of goods already on hand and those still being made demand is insufficient to maintain price at its previous level.

The problem with it sir is that your undrelying premise is faulty.

 

But generally the more workers you have with the right capital, the more is produced, and vice-versa. Which is still true today.

Yes everyone else would get that money, even if it was all taken by rich people. The rich would put it into a bank and the bank would loan it out to people. And yes inflation would happen because demand stays the same since when people have more money they spend more, and if people are willing to spend more, the price for a good goes up due to demand.

 

In that case you still don't get inflation because the other people getting the money would just make other product which would again put everyone back to work just doing soemthing different than they used to so and there is still no need for government to do anything but stay out of the way.

 

But companies would raise their prices when they run low on goods even if they would hire more people to make them later.

 

Also if it was impossible it hire more workers inflation would happen, which is the case I was really thinking of.

 

You're back to providing a perverse incentive to employers. They will change behaviour in order to acquire the 'free' training monies. That will change their procedures in the internal labour market (possibly engineering less job security) and we'd also be back to you asking for a redistribution from the poorer elements to the 'rich' worker.

No its not. Unemployment reflects various aspects. Frictional unemployment, for example, is not necessarily a problem. Encouraging low wage/low skilled labour would engineer long term economic problems (see, for example, Britain and how it created too much resources going to product with low income elasticity of demand with low growth potential). And longer term forms of unemployment? Offering low skilled labour to the young will just be a right wing exercise in discouraging welfare. It doesn't improve the labour market, it just discourages an efficient use of labour resources (e.g. we've seen underclass problems where, instead of using the 'welfare to work' systems, folk turn to the black economy)

I'm saying you don't have the knowledge to create a programme that doesn't engineer negative spillover effects. If you try to mess with internal labour markets you'd just create inefficiency and inequity. If you try and go for easy hits with low skilled labour you'd effectively just be giving the standard right wing anti-welfare response

The truth of your system is that you will be forced to redistribute away from the poorer elements. You'd have to harm the social wage, where it seems you're helping workers but its actually workers paying for the whole debacle.

 

There is no behavior that will get them sponsored jobs other than applying once to the program. If they fire a worker in hopes of getting him or her back as a sponsored job, there are extremely small chances of that worker being recruited and put back into that business, especially in a city. This is reinforced by the fact that no one would be willing to be unemployed long enough or in big enough numbers to be considered significant unemployment.

Well yeah frictional unemployment is a reasonable thing to have. This plan won't get rid of frictional unemployment, as most workers wouldn't accept their career being chosen for them when they have the skills to get the job they want. Also, this plan would initiate recruitment far later then when a frictionally unemployed workers gets hired.

like what economic problems?

A link would be helpful, I can't think of any google search that would find what you're referencing.

Anything's more efficient than not having them work. But anyway yeah it is bad to only create low skill jobs, so hopefully this plan can create higher skill jobs as well. Although bad workers will have to accept low skill jobs, there is nothing that can around that.

I understand perfectly well I'm one stupid teenager... I think it would really be stupid to take my plan as it stands into national policy. What I'm really hoping for is that I'm onto something useful that will be found and shaped into something. Do you disagree with that it's possible to create jobs that produce something with printed money? I think that is something that should be looked at. Am I wrong?

What are the poorer elements? Whats the social wage? (My lack of economic knowledge is showing sadly...)

 

It only requires the existence of the scheme for behavioural effects to kick in. It would be decidedly naive to think firms wouldn't take advantage of 'free' money

[FONT=&amp]

[FONT=&amp]I don’t see any rationale in how you are distinguishing between unemployment types. Frictional unemployment isn’t easily defined. Are you going with a simple long term unemployment measure? If so you’re going to have to refer to substantial training costs (and ineffective expenditures too as the long term unemployed can’t simply be introduced into complex internal labour markets) or again return to the ‘welfare to work’ sham used in right wing politics.[/FONT]

Low growth and a low skilled equilibrium that allows social ills to flourish

The analysis into low income elasticity of demand comes from the likes of Thirlwall. However, the general analysis is in any labour economics text book! We see that again you've constructed an idea without doing any of the leg work first.

Clearly not true. We could get everyone working through communist dictatorship, but it isn't going to be an efficient option!

Bad workers? The US seems to have them in abundance. Ask yourself why? One aspect has it been the increased focus on flexible labour markets. You're actually trying to add to the problem by making the provision of low skilled labour even cheaper!

Of course I do. The idea that we can use monetary policy to solve our ills really isn't cunning. The focus must be on microeconomic policy.

The social wage allows us to understand the true nature of redistribution policy. It takes into account welfare and taxes. It shows, for example, that much redistribution policy is actually illusionary (i.e. workers pay for their own benefits).

 

There are no logical schemes.

Well frictionally unemployed workers simply won't jump onto the program, since they already have a plan to get employed with their skills.

You mean people who are unemployed for long periods of time due to their lacking skills/ability? They will have to accept low skill jobs when they fail to preform in training, as in constantly getting bad scores in their funded college courses.

Yes training costs will be substantial, but that money will scew the labor market towards higher skill labor that will also be useful by training other workers. (as in colleges having to hire more professors to keep up with the increased demand for college courses)

Creating low skill jobs won't reduce the amount of high skill jobs because high skill jobs are incentivized through higher wages.

The existence of low skill jobs can't be eliminated, so there will always be social ills, but a strong enough economy will reduce them.

Well my economics class didn't cover it and I didn't know how to find it. Sheesh.

Well anyway I see your criticism now. Well the problem of creating products with low income elasticity can be solved with hiring economists to judge the income elasticity of goods and services created and use that information to pick which business to put them in.

Well hiring people to produce any product or service selected in the free market is better. (excluding "adult" products)

You mean people will take the low skill jobs because it's easy so they will become a "bad" worker? Well the recruited workers don't choose their job, their job is chosen based on how much employers want them. The employer who rank that worker the highest on their top X wanted workers list for their job get them (after the agency takes in other information of course, like if a higher skilled employer wants them equally as much as the low skill employer). so workers who seem to be able to take high skill jobs will get high skill jobs (if they make it through training), and workers who seem bad will get low skill jobs.

Well why isn't it possible to add one worker/consumer and a reasonable amount of money for their paycheck to the economy?

 

I'm tired of going around in circles with you. I'll leave it to someone with more patience. Good luck with it!

 

Sigh, well I do appreciate your criticism thus far so thank you. I'll leave you with a like, not anger.