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Communism for some, pay rises for others!

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  • 18-11-2012 2:55am
    #1
    [Deleted User]
    Posts: 0 ✭


    http://www.rte.ie/news/2012/1117/teeu-portlaoise-conference.html
    The State may need to contemplate becoming an employer of last resort to tackle unemployment, according the ICTU General Secretary David Begg.
    Earlier, the TEEU said it would seek pay rises of at least 5% in profitable enterprises where it represents staff.

    Delegates at its annual conference overwhelmingly backed an emergency motion instructing the union to present significant pay claims in all profitable companies and sectors.

    With 40,000 members, the TEEU is Ireland's largest craft union and a major player in manufacturing, construction and energy.

    Communism for some, pay rises for others! Now why didn`t I think of that! Economic crisis solved!!

    Is this the solution? :pac:


«13

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    #2
    TheRealPONeil
    Registered Users Posts: 132 ✭✭TheRealPONeil


    Deleted User wrote: »
    Communism for some, pay rises for others!

    Old News, it's happening since 2011 ...

    "60% of survey respondents expect a return to salary increases in 2012"

    for some !!


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    #3
    KyussBishop
    Closed Accounts Posts: 5,797 ✭✭✭KyussBishop


    An 'employer of last resort' i.e. job guarantee is pretty much exactly what the country needs, but is not possible without the EU's help; it is good to at least see it somewhere in Irish political discourse though.

    The social cost of unemployment is going to stay with the country for generations if it's allowed to continue, and it causes significant and totally unnecessary suffering to people in society, and damage to society in general too.


    Austerity is a policy choice at the EU level, that is being forced on us, and it guarantees massive economic damage, and massive societal damage, with regards to unemployment and much much more.
    It is a retrograde policy choice, where arguments insisting on it are based on outdated theory harking back to the days when there was still a gold standard, whereas now we're dealing with a fundamentally different fiat monetary system.

    For all the rhetoric (i.e. lies) that "there is no alternative", growing numbers of economists everywhere are screaming out for money creation, to be put into non-financial sectors of the economy (a job guarantee is perfect for this), and to assist in making deficits manageable.
    You'll find completely unbacked assertions that there would be hyperinflation, in response to this, but it's bullshít scaremongering/FUD that is not really taken seriously by most economists, and which doesn't stand up to scrutiny.

    You will not find an argument outlining the scale of inflation we can expect, in relation to 'x' amount of money being created and put into a job guarantee program, just FUD, that any money creation is bad; and any potential for inflation, is considered to be intolerable, whereas forcing enormous numbers of people into unemployment (preferably with no unemployment income to fall back on, leading to poverty and homelessness for many), is perfectly tolerable and desired, portrayed as a 'necessary evil', when the people advocating that can't even prove or quantify the damage that would occur through spending 'x' amount on a job guarantee.

    It is a sociopathic policy choice that's being imposed on us, and with a clear alternative set of policies that can start us on the way out of this, I'm of the opinion that there can only be the most cynical of reasons for keeping us held in this purgatory, for the benefit of a tiny few.


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    #4
    thebman
    Closed Accounts Posts: 10,012 ✭✭✭✭thebman


    You'd have to be an idiot be believe this was possible given our financial situation and the general financial position of other EU countries.

    How are you going to pay for it? I'm sure you'll get some BS line like the increase in productivity will pay for it meaning they have no way to pay for it, know it won't be implemented, isn't practical and are just trying to make it look like government are being unnecessarily mean to people for no good reason.

    Government would do this in a second if it was affordable, do you know how many votes it would buy?


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    #5
    KyussBishop
    Closed Accounts Posts: 5,797 ✭✭✭KyussBishop


    thebman wrote: »
    You'd have to be an idiot be believe this was possible given our financial situation and the general financial position of other EU countries.

    How are you going to pay for it? I'm sure you'll get some BS line like the increase in productivity will pay for it meaning they have no way to pay for it, know it won't be implemented, isn't practical and are just trying to make it look like government are being unnecessarily mean to people for no good reason.

    Government would do this in a second if it was affordable, do you know how many votes it would buy?
    Try engaging in actual argument, rather than labeling anyone an 'idiot', thanks.

    You obviously have not even read my post at all, or are deliberately ignoring key parts of it for the sake of spewing ad-hominem; the EU is not living under a fixed money supply, and I've explained exactly how funding this is manageable, at an EU level, in my previous post.


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    #6
    thebman
    Closed Accounts Posts: 10,012 ✭✭✭✭thebman


    KyussBishop wrote: »
    Try engaging in actual argument, rather than labeling anyone an 'idiot', thanks.

    You obviously have not even read my post at all, or are deliberately ignoring key parts of it for the sake of spewing ad-hominem; the EU is not living under a fixed money supply, and I've explained exactly how funding this is manageable, at an EU level, in my previous post.

    Did I quote you? :rolleyes:

    I don't really think just print and it will be grand, I promise there will be no hyperinflation isn't really telling anyone how you'd fund it though IMO.


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    #7
    KyussBishop
    Closed Accounts Posts: 5,797 ✭✭✭KyussBishop


    thebman wrote: »
    Did I quote you? :rolleyes:
    You labelled anyone promoting the idea of a job guarantee as an 'idiot', and no, you obviously didn't read my post at all as it completely addressed the concerns you brought up in your own post.
    thebman wrote: »
    I don't really think just print and it will be grand, I promise there will be no hyperinflation isn't really telling anyone how you'd fund it though IMO.
    If you claim there will be hyperinflation, back that up; the ECB has printed over €1 trillion thus far, and we have not seen hyperinflation.

    The EU are perfectly capable of putting stimulus into non-financial areas, and in using it to make deficits/debts more manageable, and to use those means to fun a job guarantee program.


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    #8
    Gloomtastic!
    Registered Users Posts: 8,402 ✭✭✭Gloomtastic!


    KyussBishop wrote: »
    the ECB has printed over €1 trillion thus far, and we have not seen hyperinflation.

    .

    Why not? Is the European economy so ****ed that it can soak up all this money and we don't notice? Or are the banks just propping up their balance sheets?


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    #9
    KyussBishop
    Closed Accounts Posts: 5,797 ✭✭✭KyussBishop


    Gloomtastic! wrote: »
    Why not? Is the European economy so ****ed that it can soak up all this money and we don't notice? Or are the banks just propping up their balance sheets?
    We don't see that, because the economic theories that predicted it are simply wrong; money creation does not automatically lead to inflation, that is a myth.


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    #10
    thebman
    Closed Accounts Posts: 10,012 ✭✭✭✭thebman


    KyussBishop wrote: »
    We don't see that, because the economic theories that predicted it are simply wrong; money creation does not automatically lead to inflation, that is a myth.

    So provide us the links to your correct economic theories so...
    KyussBishop wrote: »
    You labelled anyone promoting the idea of a job guarantee as an 'idiot', and no, you obviously didn't read my post at all as it completely addressed the concerns you brought up in your own post.

    If you claim there will be hyperinflation, back that up; the ECB has printed over €1 trillion thus far, and we have not seen hyperinflation.

    The EU are perfectly capable of putting stimulus into non-financial areas, and in using it to make deficits/debts more manageable, and to use those means to fun a job guarantee program.

    I don't have to back it up, your the one putting forward that these things won't happen so you can prove it...

    You can't walk in and go nah your all wrong, here is my plan which I have no evidence for what so ever, prove it won't work.


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    #11
    KyussBishop
    Closed Accounts Posts: 5,797 ✭✭✭KyussBishop


    thebman wrote: »
    So provide us the links to your correct economic theories so...
    I don't have to provide an alternative, to show that what you're claiming is wrong, but if you're interseted, read up on Modern Monetary Theory and Post-Keynesian economics in general.
    thebman wrote: »
    I don't have to back it up, your the one putting forward that these things won't happen so you can prove it...
    Well see, the burden of proof works such that if you claim something will happen, you have to prove it.
    thebman wrote:
    You can't walk in and go nah your all wrong, here is my plan which I have no evidence for what so ever, prove it won't work.
    In making a completey unbacked assertion, in contradiction to events in the real world, this is exactly what you've done.


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    #12
    thebman
    Closed Accounts Posts: 10,012 ✭✭✭✭thebman


    KyussBishop wrote: »
    I don't have to provide an alternative, to show that what you're claiming is wrong, but if you're interseted, read up on Modern Monetary Theory and Post-Keynesian economics in general.


    Well see, the burden of proof works such that if you claim something will happen, you have to prove it.


    In making a completey unbacked assertion, in contradiction to events in the real world, this is exactly what you've done.

    No high inflation and hyper-inflation are real and there are real world, past examples of it occurring.
    http://en.wikipedia.org/wiki/Hyperinflation

    That you assume it won't exist, is an assumption. One with some pretty nasty consequences if your wrong.


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    #13
    KyussBishop
    Closed Accounts Posts: 5,797 ✭✭✭KyussBishop


    thebman wrote: »
    No high inflation and hyper-inflation are real and there are real world, past examples of it occurring.
    http://en.wikipedia.org/wiki/Hyperinflation

    That you assume it won't exist, is an assumption. One with some pretty nasty consequences if your wrong.
    I did not claim there is no such thing as inflation, I said you have nothing to back your claim that money creation automatically leads to hyperinflation.

    The ECB has already printed a trillion euro (a trillion), so where is this hyperinflation?

    At what stage would we see hyperinflation from an EU-wide job guarantee either? After it had €10 billion put in? €100 billion? €1 trillion?


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    #14
    thebman
    Closed Accounts Posts: 10,012 ✭✭✭✭thebman


    KyussBishop wrote: »
    I did not claim there is no such thing as inflation, I said you have nothing to back your claim that money creation automatically leads to hyperinflation.

    The ECB has already printed a trillion euro (a trillion), so where is this hyperinflation?

    At what stage would we see hyperinflation from an EU-wide job guarantee either? After it had €10 billion put in? €100 billion? €1 trillion?

    So your accepting we'll hit high-inflation if you just make money for the craic to pay people to do jobs that add no value to the economy?

    Because that is what your trying to sell and there is no reason why anyone with savings should accept it.


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    #15
    KyussBishop
    Closed Accounts Posts: 5,797 ✭✭✭KyussBishop


    thebman wrote: »
    So your accepting we'll hit high-inflation if you just make money for the craic to pay people to do jobs that add no value to the economy?

    Because that is what your trying to sell and there is no reason why anyone with savings should accept it.
    And again, you're making completely unbacked assertions: The €1 trillion printed by the ECB discredits the idea that money creation automatically leads to inflation.

    How many times do I have to repeat that? That totally discredits the idea that money creation alone, leads to inflation.


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    #16
    Scortho
    Closed Accounts Posts: 3,876 ✭✭✭Scortho


    Unfortunately Job guarantee schemes wouldnt work. If we create jobs that arent needed, how are businesses going to sustain the employment when the subsidies are removed?
    We already have subsidised work in the form of JobBridge, and look how successful that is.

    By subsidising employment, that an employer has no demand for, inefficiencies develop.

    Have a look at this video by Milton Friedman:
    http://www.youtube.com/watch?v=YmqoCHR14n8&feature=related


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    #17
    KyussBishop
    Closed Accounts Posts: 5,797 ✭✭✭KyussBishop


    Scortho wrote: »
    Unfortunately Job guarantee schemes wouldnt work. If we create jobs that arent needed, how are businesses going to sustain the employment when the subsidies are removed?
    We already have subsidised work in the form of JobBridge, and look how successful that is.

    By subsidising employment, that an employer has no demand for, inefficiencies develop.

    Have a look at this video by Milton Friedman:
    http://www.youtube.com/watch?v=YmqoCHR14n8&feature=related
    Good article in this post here, of Friedman's corrupt past (he is pretty much just a propagandist):
    https://www.boards.ie/vbulletin/showpost.php?p=81810710&postcount=49

    It would not be subsidizing employment, it would be creating temporary public jobs; we have lots of infrastructure jobs that we could fund, for starters (straight away here in Dublin, we could do with significant improvements in public transport, specifically extensions of local rail transport), and as the money from those projects feeds into the economy it will spur demand in the private sector, spurring more job growth.

    You can also create jobs to stockpile products or materials long-term, and release them into the economy slowly over a future period, so that productive effort is not wasted, while still providing useful work to people, and a stimulus of money into the private sector to help private business.

    Eventually, as the job guarantee goes on, the private sector will recover and will have enough capacity to absorb all of the jobs, and then the job guarantee will be wound down.


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    #18
    Scortho
    Closed Accounts Posts: 3,876 ✭✭✭Scortho


    KyussBishop wrote: »
    Good article in this post here, of Friedman's corrupt past (he is pretty much just a propagandist):
    https://www.boards.ie/vbulletin/showpost.php?p=81810710&postcount=49

    It would not be subsidizing employment, it would be creating temporary public jobs; we have lots of infrastructure jobs that we could fund, for starters (straight away here in Dublin, we could do with significant improvements in public transport, specifically extensions of local rail transport), and as the money from those projects feeds into the economy it will spur demand in the private sector, spurring more job growth.

    You can also create jobs to stockpile products or materials long-term, and release them into the economy slowly over a future period, so that productive effort is not wasted, while still providing useful work to people, and a stimulus of money into the private sector to help private business.

    Eventually, as the job guarantee goes on, the private sector will recover and will have enough capacity to absorb all of the jobs, and then the job guarantee will be wound down.

    I'm not going to discuss the Friedman article as it'll drag the thread of course. Feel free to make a new thread though as to why Friedman is wrong.


    Anyhow getting back on track your job guarantee scheme sounds more like a capital investment plan. The building of infrastructure would be something which I'd support! For example broadband infrastructure could be improved as could our roads and our light rail systems. These would also improve our ability to attract investment.

    I'm slightly confused by your second idea. Why would we stockpile materials and products?
    Where would we stockpile them?
    Would we have to waste capital on rent?
    You mention efficiency but how would it make production more efficient? Companies know what stock they need and when they need it for so are able to order it in ! The only thing that I see worthwhile stockpiling is grit!


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    #19
    KyussBishop
    Closed Accounts Posts: 5,797 ✭✭✭KyussBishop


    Scortho wrote: »
    Anyhow getting back on track your job guarantee scheme sounds more like a capital investment plan. The building of infrastructure would be something which I'd support! For example broadband infrastructure could be improved as could our roads and our light rail systems. These would also improve our ability to attract investment.

    I'm slightly confused by your second idea. Why would we stockpile materials and products?
    Where would we stockpile them?
    Would we have to waste capital on rent?
    You mention efficiency but how would it make production more efficient? Companies know what stock they need and when they need it for so are able to order it in ! The only thing that I see worthwhile stockpiling is grit!
    The stockpiling material/products is just an alternative set of jobs that could be created, if e.g. infrastructure projects/jobs are saturated, could put people into that alternative jobset; just an example of how the jobs could be created, while buffering (through the stockpile) the effects on the market.

    Could put people to work building a publicly owned warehouse for example, to avoid rent while storing it all, and then sell that off to private industry too once the stock is gone.

    The primary aim isn't efficiency though, just providing jobs while still trying not to waste the productive effort that people put in (so efficient production would be a bonus, not a primary goal); right now that we have enormous unemployment, we have both inefficiency and social harm through people not earning and spending (and their skills degrading, plus their standard of living and health degrading), and it's also an enormous waste of human productive potential.


    If we put money into this (either through interest-free deficit, or money creation), we would experience immediate economic growth due to the influx of money into the economy (through worker wages and their spending), and would be starting our way out of this recession.


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    #20
    SupaNova2
    Registered Users Posts: 515 ✭✭✭SupaNova2


    No-one is saying all money creation causes inflation, most of the monetary inflation so far has been to prevent deflation and keep banks afloat.

    One of the key parts of Schiff's Hyperinflation call in the US is that China and other foreign nations will stop purchasing US government debt and the FED will have to pick up the slack. The FED monetizing rather than existing dollar holders buying means a lot more dollars end up chasing the same amount of goods.


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    #21
    KyussBishop
    Closed Accounts Posts: 5,797 ✭✭✭KyussBishop


    SupaNova2 wrote: »
    No-one is saying all money creation causes inflation, most of the monetary inflation so far has been to prevent deflation and keep banks afloat.

    One of the key parts of Schiff's Hyperinflation call in the US is that China and other foreign nations will stop purchasing US government debt and the FED will have to pick up the slack. The FED monetizing rather than existing dollar holders buying means a lot more dollars end up chasing the same amount of goods.
    Is there somewhere I can read Schiff's claims on that? The few sources I can find with a quick Google, don't go into this much detail.

    Why would other countries stop purchasing US debt like that? That would just cause a slowdown of the US economy, thus hurting the entire world economy, as demand from the US plummets (which has been a giant sink for other countries excess supply for a long time, so everyone has an interest in it).

    It seems highly unlikely, that any country would stop purchasing US debt like that, especially seeing as they have the reserve currency.


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    #22
    SupaNova2
    Registered Users Posts: 515 ✭✭✭SupaNova2


    KyussBishop wrote: »
    Is there somewhere I can read Schiff's claims on that? The few sources I can find with a quick Google, don't go into this much detail.

    Sorry are you asking a source for Schiff's prediction or a source that shows that the Chinese(or others) are no longer purchasing US debt to the same extent as before?
    Why would other countries stop purchasing US debt like that? That would just cause a slowdown of the US economy, thus hurting the entire world economy, as demand from the US plummets (which has been a giant sink for other countries excess supply for a long time, so everyone has an interest in it).

    If you doubt getting payed back why would you lend is the question, there are plenty of other things they could do with their dollars to offset a contraction of US demand, buy oil and natural resources for infrastructure projects sounds better than lending money to someone who wont pay back. As the relative purchasing power of the dollar diminishes the relative purchasing power of other currencies increase, so they will still have an export market.
    It seems highly unlikely, that any country would stop purchasing US debt like that, especially seeing as they have the reserve currency.

    I don't follow, why should they purchase their debt because of them having the reserve currency?


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    #23
    mariaalice
    Registered Users Posts: 12,451 ✭✭✭✭mariaalice


    I wouldn't be a libertarian or even close, however any the government becoming the employer of last resort is too much interference in the labour market and I do thing it could lead to something like a modern version of stagflation. It interesting the op has coupled together the two ideas.

    Government guaranteed work.
    A call for wage increases in some industries.


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    #24
    [Deleted User]
    Posts: 0 ✭ [Deleted User]


    mariaalice wrote: »
    It interesting the op has coupled together the two ideas.

    Government guaranteed work.
    A call for wage increases in some industries.


    Yes because increasing wages means you limit hiring more people.

    Also government interference in wage setting such as minimum wages for specific jobs i.e you cannot hire a plumber/electrician/taxi for less than the labour courts decide has already bred a huge black market and increased unemployment as a result.

    If you pump money into inefficient labour you prevent the correction that is needed to bring down costs. Ireland would remain uncompetitive.

    Remember we do not control our currency. I really question the motives and thinking behind these union leaders. If they want communism then come out with it.


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    #25
    mariaalice
    Registered Users Posts: 12,451 ✭✭✭✭mariaalice


    Its interesting I am in a union manly because 90% of the people I work with are in the same union, if the unions really are communist in there thinking I would not be happy to be supporting them, I joined the union as a sort of social solidarity with other people I work with.

    My thinking on government interference in the labour market.

    I believe in having a minimum wage and agreed rates for apprenticeships. After that there should be no government interference with wage rates, however if individually unions manage to negotiate a certain wage rate thats fine, the important point is that the government and by extension the state should not be involved in setting wage rates ( except as employers )

    I also think a small amount of profit sharing in profitable company's as opposed to wage increases could be a good idea,


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    #26
    KyussBishop
    Closed Accounts Posts: 5,797 ✭✭✭KyussBishop


    SupaNova2 wrote: »
    Sorry are you asking a source for Schiff's prediction or a source that shows that the Chinese(or others) are no longer purchasing US debt to the same extent as before?
    Schiff's argument on the issue primarily; it would be interesting to see the details of it.
    SupaNova2 wrote: »
    If you doubt getting payed back why would you lend is the question, there are plenty of other things they could do with their dollars to offset a contraction of US demand, buy oil and natural resources for infrastructure projects sounds better than lending money to someone who wont pay back. As the relative purchasing power of the dollar diminishes the relative purchasing power of other currencies increase, so they will still have an export market.



    I don't follow, why should they purchase their debt because of them having the reserve currency?
    The debt is just a tally card of how much one country owes another; it can expand as much as they like, so long as the interest payments stay manageable.

    The US are perfectly capable of paying back their debt, and seem to have plenty of willing buyers still, so I don't see why they would hit issues. If they couldn't expand the debt further, that would just be exactly like hitting the upcoming artificial fiscal cliff if they did in any case? (which indeed, is about to set them back into recession, but is a totally artificial political problem)

    In either case, there's absolutely no question about the ability of the US to repay their debts.

    Also, if other countries stopped buying US debt, and forced the US into fiscal problems as a result, that would be against their interest due to the impact it would have on the value of the USD, meaning they'd get paid back less on their holdings of US debt.

    I'd need to see Schiff's writing on this to get a better idea of it, as it seems a bit like a red herring, which I suspect begs the question of hyperinflation (thus possibly being a circular argument, but I'd need to see the original writing, to confirm that).


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    #27
    KyussBishop
    Closed Accounts Posts: 5,797 ✭✭✭KyussBishop


    mariaalice wrote: »
    I wouldn't be a libertarian or even close, however any the government becoming the employer of last resort is too much interference in the labour market and I do thing it could lead to something like a modern version of stagflation. It interesting the op has coupled together the two ideas.

    Government guaranteed work.
    A call for wage increases in some industries.
    How would it lead to a modern version of stagflation? You're presupposing high inflation again; a job guarantee (with government providing the temporary jobs) isn't just as simple as pumping money into jobs (it also has nothing to do with private jobs), and it has mechanisms to ameliorate inflation too.
    Deleted User wrote:
    If you pump money into inefficient labour you prevent the correction that is needed to bring down costs. Ireland would remain uncompetitive.

    Remember we do not control our currency. I really question the motives and thinking behind these union leaders. If they want communism then come out with it.
    That 'correction' is slashing peoples quality of living and income, destroying our internal economy, and making imports ever more expensive, in order to turn is into a cheap manufacturing hub, which makes our economy even more unstable/dependent, to other economies (and the US isn't the big sinkhole of excess supply it used to be, so who are we going to export to?).
    It also necessitates a period of massive unemployment and social damage to get there in the first place, which is easily avoidable, thus is it wholly immoral too.

    It is exactly that we don't have control over our own currency which is the problem, so we need to lobby the EU to act, not just shut up and accept austerity; it is an enormous and gross mismanagement within the EU, that is imposing this on us, with many vested interests deliberately keeping things in limbo, to destroy our economy (and many other countries economies), so that private financial interests can pick at the corpse.

    If all we ever discuss, is what part of the budget to tear down, or what state assets to sell to the fraudulent finance industry, then we are already accepting the worst possible outcome.


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    #28
    SupaNova2
    Registered Users Posts: 515 ✭✭✭SupaNova2


    KyussBishop wrote: »
    Schiff's argument on the issue primarily; it would be interesting to see the details of it.

    His books or this interview from 2009 would be a good overview:
    https://www.youtube.com/watch?v=eksf2ScG6yU


    In either case, there's absolutely no question about the ability of the US to repay their debts.

    Yes they have no problem paying off their debt nominally, after all its denominated in a currency they can print.
    Also, if other countries stopped buying US debt, and forced the US into fiscal problems as a result, that would be against their interest due to the impact it would have on the value of the USD, meaning they'd get paid back less on their holdings of US debt.

    The options are take a loss on their existing holding of US debt, or further increase their holdings of bad US debt. China have actually sold close to $115 billion of their US debt in the past year, and they accumulated almost no new US debt since 2010. Japan have been the major foreign buyer the last few years.


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    #29
    mariaalice
    Registered Users Posts: 12,451 ✭✭✭✭mariaalice


    KyussBishop wrote: »
    How would it lead to a modern version of stagflation? You're presupposing high inflation again; a job guarantee (with government providing the temporary jobs) isn't just as simple as pumping money into jobs (it also has nothing to do with private jobs), and it has mechanisms to ameliorate inflation too.


    That 'correction' is slashing peoples quality of living and income, destroying our internal economy, and making imports ever more expensive, in order to turn is into a cheap manufacturing hub, which makes our economy even more unstable/dependent, to other economies (and the US isn't the big sinkhole of excess supply it used to be, so who are we going to export to?).
    It also necessitates a period of massive unemployment and social damage to get there in the first place, which is easily avoidable, thus is it wholly immoral too.

    It is exactly that we don't have control over our own currency which is the problem, so we need to lobby the EU to act, not just shut up and accept austerity; it is an enormous and gross mismanagement within the EU, that is imposing this on us, with many vested interests deliberately keeping things in limbo, to destroy our economy (and many other countries economies), so that private financial interests can pick at the corpse.

    If all we ever discuss, is what part of the budget to tear down, or what state assets to sell to the fraudulent finance industry, then we are already accepting the worst possible outcome.

    Explain how government guaranteed employment would not cause inflation eventually.

    (1) what rates of pay are you proposing to pay for the government guaranteed jobs.

    (2) How would it not interferer with the local jobs market, for example around Christmas retail takes on a lot of short term workers which are then let go in January they are mostly at minimum wage although some pay more. If all the supples labour is take up by a government guaranteed job retail employers will have to pay more than the government guarantee job/min wage to get employees thus causing wages to rise because of government interference which is wage inflation.

    (3) Stockpiling goods is a silly idea because if they are stored for any length of time they will problem be obsolete by the time they are released on to the market. ( phone 1 verses phone 4 or 5 ).

    I do think the social impact of unemployment is an important subject but I think it needs to be looked at in a completely different way. Have you ever read the right to useful unemployment Ivan Illich.


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    #30
    Scortho
    Closed Accounts Posts: 3,876 ✭✭✭Scortho


    KyussBishop wrote: »
    The stockpiling material/products is just an alternative set of jobs that could be created, if e.g. infrastructure projects/jobs are saturated, could put people into that alternative jobset; just an example of how the jobs could be created, while buffering (through the stockpile) the effects on the market.

    Could put people to work building a publicly owned warehouse for example, to avoid rent while storing it all, and then sell that off to private industry too once the stock is gone.

    The primary aim isn't efficiency though, just providing jobs while still trying not to waste the productive effort that people put in (so efficient production would be a bonus, not a primary goal); right now that we have enormous unemployment, we have both inefficiency and social harm through people not earning and spending (and their skills degrading, plus their standard of living and health degrading), and it's also an enormous waste of human productive potential.


    If we put money into this (either through interest-free deficit, or money creation), we would experience immediate economic growth due to the influx of money into the economy (through worker wages and their spending), and would be starting our way out of this recession.

    This is the wrong way to go about creating employment.
    What we need is stuff that will last.
    What are we going to do, build ikea warehouses in every town in the country and stuff them full of raw materials so Johnny can think he is working.
    Raw materials that will cost us money to buy in the first place.
    Lets say we buy copper. And we stockpile some of these state built and run warehouses with copper. In five years time what happens if the price of copper falls through the floor. We've lost a fortune on the raw materials that we didnt need in the first place. Who picks up the bill?

    The way to create employment is by attracting large multinational firms to the country. The construction/fitout of their premises will provide much needed jobs for the construction industry.
    The new employees of these firms, will spend their money in the local economy which will create employment in shops, restaurants etc.
    According to the IDA "Over 1,000 IDA supported companies in Ireland employ over 146,000 people. These companies accounted for exports of over €115 billion and generate €19 billion of expenditure in the economy." see part 1.6
    http://www.idaireland.com/help/

    We can also create employment by further supporting jobs created by indigenous companies.
    Take for example the Kerry group jobs announcement for the new food research site. The construction of the facility will create a 400 construction jobs, while 900 people, many of whom will be high tech graduates will be employed once the site is fully operational.
    It has been estimated that this will help create another 1100 jobs in the greater kildare area.

    Surely providing grants to companies, both Irish and multinational is a better idea than providing meaningless temporary state jobs in the stockpiling of materials where they're not even needed.


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    #31
    KyussBishop
    Closed Accounts Posts: 5,797 ✭✭✭KyussBishop


    SupaNova2 wrote: »
    His books or this interview from 2009 would be a good overview:
    https://www.youtube.com/watch?v=eksf2ScG6yU


    Yes they have no problem paying off their debt nominally, after all its denominated in a currency they can print.

    The options are take a loss on their existing holding of US debt, or further increase their holdings of bad US debt. China have actually sold close to $115 billion of their US debt in the past year, and they accumulated almost no new US debt since 2010. Japan have been the major foreign buyer the last few years.
    Haven't had a chance to look at that video, will take a look when I can; ta.

    It's interesting that the debt is shifting around, and wondering on the reasons, though I'm not sure it's hugely significant; I don't think there will be any kind of crisis of confidence in the debt (or further deficit), so long as the US economy doesn't downturn (which the upcoming artificial fiscal cliff may make more likely).


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