The Roanoke Times’ read of the day — July 20, 2011
Cons
umer demand creates jobs, NOT ‘the rich’
Theodore Fuller, a professor of sociology at Virginia Tech, truly nails to the wall the heretics who have rebranded wealthy Americans as “job creators.” Click on the preceding link for the full column. Here’s the heart of it:
First, jobs are actually created by consumers, not by entrepreneurs. Unless consumers create demand for a good or service, no entrepreneur is going to create a job to produce that good or service. Consumer demand remains weak because millions of Americans are out of work and millions of others have not had a raise in several years.
Second, most of those who are in the top 2 percent of earners are corporate executives. While corporations create jobs, corporate executives do not. If the CEO of XYZ Inc. pays higher taxes, this has no bearing on whether XYZ Inc. will expand and create jobs. XYZ will use its own funds, not the funds of its CEO.
U.S. corporations have plenty of funds on hand to create jobs if they want to. They are sitting on cash resources of more than $1 trillion, but most are not investing to create jobs precisely because consumer demand is weak. The point is, raising taxes on the CEO does not affect the ability of the corporation to invest and create jobs.
This simple explanation pretty much jams the wooden stake into the heart of the “job creators” myth. Now that that vampire is slain, we should move on to other lies the bloodsuckers are telling.
July 20, 2011 - 11:00 AM
“Second, most of those who are in the top 2 percent of earners are corporate executives. While corporations create jobs, corporate executives do not. If the CEO of XYZ Inc. pays higher taxes, this has no bearing on whether XYZ Inc. will expand and create jobs. XYZ will use its own funds, not the funds of its CEO.”
Exactly what I was saying. But hey, what do I know?
Absolute pure thinking. And slashing 700000 jobs out of the economy by slashing the federal budget and multiplying that by cuts generated in local and state budgets will cut demand even further and lead to more job loss. And Republitarchs are too stupid to see it.
Must disagree with the good professor on the first part of the paragraph, with the assertion of the relationship between entrepreneurs and consumers.
An astute entrepreneur most often finds the consumers’ needs before the consumer is even aware; thus, the innovative entrepreneur goes about supplying that demand before competitors can seize the consumers’ market.
If this professor was promoting his economic theory with that sort of assertion on my campus, he would be packing his books …tenure or not.
You may want to read the entry about the “Fix-It-Man” http://theroanoketribune.com/catalog_25.html
The last paragraph esplains it all.
“So, why are Republican politicians so adamantly opposed to higher taxes on the top 2 percent? Mainly because the top 2 percent provide so much of their campaign contributions, and they want to keep their donors happy.”
Someone told me a while back if the average homeowner had gotten some tax relief/stimulus money, that would have gotten things moving.
I would think those folks with houses who were struggling to pay for them would be able to make that house payment. They might also buy goods such as a washer, dryer, refridgerator, stove, etc., which would have created some demand for those items, and perhaps some jobs in manufacturing those goods. As it stands now, I bet most people are buying things second hand off Craigslist if they can get the money together to buy a washer or stove.
So, Ray Kroc, Bill Gates, Steve Jobs, Sam Walton all had consumers demanding their products and services before they were available? People were lining up for a pc, macbook, i-phone and hamburgers before these entrepreneurs decided to produce them? Consumer demand fuels growth for the products yes, but without the insight and willingness to risk the capital the products don’t come forth. Henry Ford, Alfred Sloan, Thomas Edison sensed the demand could be developed but they were the ones who took the risk to pay the employees. Jobs are what employees have and employers are the ones who create them. Growth of jobs in directly related to the willingness of employers who are entrepreneurs being willing to gamble and place their capital at risk. Until the economic environment becomes worth the risk their won’t be any jobs created. Consumer willingness is fuel not the catalyst. If a million people said they wanted to buy a widget today, there would be an entrepreneur willing to risk the capital to produce, distribute, sell, and service the widget. In today’s economy that widget would have to save me a lot of money and or time to be worth me spending the fewer disposable dollars I have left after paying for the things that have increased in price (fuel and groceries). Come on man! You and I don’t go buy anything that hasn’t been produced and in order for it to be produced an entrepreneur has to take a risk to produce it. But if consumers are the catalyst for job growth then the only way to get them to spend more money is to give them more to spend. So a stronger dollar and lower taxes and higher wages should get the desired result, right?
Professor Fuller is spot on! VT Hokie has said that same thing too and I agreed then as well. That was always a canard and it is about darn time someone called them on it.
Phil Holsinger, your knowledge of business history is quite lacking.
Ray Kroc was a milkshake-machine salesman whose largest customer was McDonalds, a family-owned California hamburger stand. Kroc could not believe how many hamburgers the McDonald brothers sold. He bought their company, then he expanded, and met the demand that obviously already existed.
Bill Gates and Microsoft developed MS-DOS under a contract from IBM, which wanted an operating system for the new line of personal computers it was selling. Actually, Gates/Microsoft bought an existing operating system developed by others and modified it to MS-DOS. It was not an easy system to use when it was first developed. When Gates realized how intuitive Apple’s operating system was, he developed Windows, which is what made Microsoft what it is today. He realized that demand for an intuitive OS already existed and met it.
You might have a point with Apple. But what Jobs truly had was an intuitive understanding of barriers to consumer demand. He worked out a system not that “created” that demand, but overcame the barriers to something that already existed, which he had the foresight to detect.
Sam Walton invented no products. He simply offered existing products at a lower price. He had a great understanding of a simple principle of consumer demand: a lower price for an existing product = higher sales.
Building a better mousetrap, which is essentially what Ray Kroc, Bill Gates, Steve Jobs, Sam Walton et al did, is not the same as job creation either. They had a product, risked bringing it onto the market and won big, ergo creating jobs, but they could just as easily have been the Edsel, the DeLorean, or a million other products that demand never bothered with. It is not that they do not “create” demand so much as command demand. Maybe that would be the better word. You can only sell what people will buy. In down economies they do not buy and it does not matter what you sell if no one wants it. It is still the product that creates the demand and vice versa and from that comes the jobs.
Even if you granted the reasoning that they “created” demand, that takes innovation, tests, models, marketing and product and all of that requires workers, so at best it is a symbiotic relationship and one without the other does not make it.
I didn’t realize a sociology teacher was such an expert on job creation. Does he also teach economics or business? Calling the wealthy “heretics” not the best adjective to bash rich people. Calling someone a heretic should be used for religious bashing.
“Consumer demand remains weak because millions of Americans are out of work and millions of others have not had a raise in several years”
Could it be current government policies of the democrats are to blame? They have been in complete power since 2009 when they took control of congress and the WH. Only until last election did the Republicans have any power. The number of seats lost was historic wasn’t it? During that time: The unemployment number was never this high under Bush. The deficit was never this high under Bush.
religious
Phil do you know how we go about getting those “higher wages”? So far all I have ever seen is tactics to destroy high wage jobs and tax cuts for people already well off. What gets us those higher wages to fuel demand again?
@Dave, there are about 22 million government jobs. 700,000 would be 3 percent which could easily handled by attrition. There are about twice as many government jobs than manufacturing jobs in the US…does that seem balanced or out of whack?
Regarding top exec compensation, I believe any comp over say 50 times the Company’s lowest paid worker should not be tax deductible to the Company. That would remove tax payor subsidation of outrageous exec comp.
The last paragraph esplains it all.
“So, why are Republican politicians so adamantly opposed to higher taxes on the top 2 percent? Mainly because the top 2 percent provide so much of their campaign contributions, and they want to keep their donors happy.”
Democrats get their contributions from an even small group of elitist rich. GOP at least has a large grass-roots giving base. Dems do not. in other words, you point makes no sense, genius.
I guess we should turn it around on Mr. Fuller and ask: “When the demand is there, who is it that provides the goods and services? Answer: The “wealthy” business owner. So this idiot is talking in circles.
So what do you do Eric? Besides questioning other people’s credentials and intelligence I mean. What makes you qualified to speak on the subject since that is the criteria you have applied to Professor Fuller?
Bill Perdue
So you think that subtracting 700000 more jobs from the economy, plus the multiplying effect of stste and local jobs lost by decreased federal funding would ceate MORE demand for products and services and would be
GOOD for the economy ? That’s living in an economic dream world IMO. I agree with your second premise, however.
Eric
So lets hear what par5t of your credentials are better than the sociology professor’s for telling us how lower taxes for the top 2% will create jobs.
The simple fact is, those cuts under George Bush created no jobs and led to the flatest job growth rate in the country in over 70 years. The sociology professor can readand interpret numbers, which seems to be a skill lacking in trhe people drinking the tea party tea.
Eric says : “I didn’t realize a sociology teacher was such an expert on job creation. ”
This has long been my gripe with the editorial garbage the RT sometimes prints from outside contributors. Retired personnel espousing the virtues (and lack thereof) of green technology, despite never having touched the stuff. Sometimes their “opinion” can be misconstrued as fact by the way they write.
I would hold more creedence if this guy was a professor of economics, even if sociology touches on economic issues.
“I didn’t realize a sociology teacher was such an expert on job creation. Does he also teach economics or business?”
One can have knowledge of a subject that is outside of what they do for a living. I don’t think he was claiming that his status as a sociology professor gave him any extra credibility.
Besides, it hardly takes an expert in economics to know that taxing a CEO’s salary doesn’t take more money away from the company, only from the CEO. The people that try to convince you that lowering taxes on the incomes of wealthy people are trying to do so by being deliberately misleading. Lowering business taxes and lowering income taxes are not the same, and do not produce the same outcome. They defend lower taxes on wealthy individuals’ personal income by talking about the benefits of lower taxes on businesses, lumping the two together to confuse the issue.
A company executive making $500,000 per year isn’t a job creator. The company that pays him might be, but lowering the percentage of income tax that is taken from the paychecks of their employees isn’t going affect their job creating ability one way or another.
“Sometimes their “opinion” can be misconstrued as fact by the way they write. ”
If it’s on the editorial page, it’s opinion. The RT can’t help it if some people don’t get that. The page in the paper and on the website is clearly labeled “Opinion”.
#10- “The unemployment number was never this high under Bush. The deficit was never this high under Bush.”
Eric, don’t fool yourself into thinking things were so rosy under Bush. Much of this started or gained steam under his watch. Not all of it was his fault, but like Obama, much of it was made worse by the things he did (and in some cases did not do).
I’ve said quite a few times that in many areas Obama is just carrying on what the Bush administration started, so yes these dismal numbers have continued on a similar course. As I noted on a different blog- if the policies or tactics used by the Bush administration caused or made much of this situation worse… why in the heck did the Obama administration think it would work any differently? Obviously it hasn’t.
Btw- we already know what the numbers look like under Obama. Here’s a refresher on Bush’s.
January 2001 Bush takes office: unemployment rate 4.2%
January 2009 Bush left office: unemployment rate 7.6%**
Clinton: 22.7 million jobs created
Bush: 1.08 million jobs were created
January 2001 Bush takes office: Federal surplus $86.4 billion
January 2009 Bush left office: Federal deficit $1.5 trillion
January 2001 Bush takes office: National debt was $5.7 trillion
January 2009 Bush left office: National debt was $10.6 trillion
**When Bush was still president, Goldman Sachs projected that the unemployment rate could reach 8.5% in the first year of the next president’s term. And other sources predicted it could go as high as 10% in the near future.
“Roanoke stab victim refuses to finger attacker, police say” seriously RT?!? This headline made me LOL…but I have to side with the victim on this one, I COMPLETELY UNDERSTAND why they wouldn’t particularly feel like “fingering” an attacker. lol
@15 & 17 My credentials are none of your business. Glad to see you are still blaming Bush.
P.S. Have a nice day!
From the NY Times and this happened while…Bush was president.
http://economix.blogs.nytimes.com/2009/07/30/top-1-paid-more-in-federal-income-taxes-than-bottom-95-in-07/
#10- I also wouldn’t try to blame everything on the Democrats- both parties are responsible. They both forgo fiscal responsibility when they’re in power.
I’m sure you know how much the Democrats love to spend our money- here’s a few things on the Republicans. Keep in mind, when looking at the dates below, that the Republicans gained Congress majority in 1995 and held onto it until 2007.
“From 1999 though the end of 2006, the United States financed a string of large current account deficits by borrowing $4.4 trillion from other countries—a sum amounting to 85 percent of total net borrowing worldwide.” Federal Reserve Bank of NY
The deficit ceiling was raised 7 times under Bush- 2002, 2003, 2004, 2006, 2007, 2008 (2x)
My column is opinion, too.
Dave
Attrition: a gradual reduction in work force without firing of peronnel, as when workers resign or retire and are not replaced (dictionay.com)
My “opinion” is that Mr. Fuller is spot on.
#23 “My credentials are none of your business.”
IOW, Eric has no credentials.
And I wonder why that phrase sounds so familiar?
Yesterday, Cisco Systems announced it would cut 6,000 jobs, while on its’ balance sheet it has over 40 BILLION dollars in cash! That is a perfect example of a common situation now: corporations are not using the essentially free money that the FED has provided in QE 1&2 to make capital investments and job creation, they are sitting on it, or buying back stock, or in the case of many companies and most Wall street firms and big banks, paying huge bonuses to a small echelon of top execs.
Before anyone tries to say that U.S. regulatory uncertainty is the main cause of their reluctance to invest, in this case, Cisco says that it is a demand problem, despite it still being a leader in its’ markets. And CEO John Chambers is a generally responsible, not venal exec., but feels compelled to take these measures until demand returns, and their customers are other big companies and institutions, so consumers can only do so much to help.
Also, Mitt Romney had a large percentage of his last reported fundraising from bundlers, and Obama had a huge amount from small donors. Just Sayin’…
#27 Not sure how to break it to you, Bill P., but attrition also subtracts jobs from the economy.
And opinions, albeit some backed by facts, are exactly what we post here as well. Some people do confuse the two, but oddly enough the people that Eric, Scott and others listen to daily are also just offering opinion or analysis and they never seem to make that connection.
Somehow I knew that would be your answer Eric! BTW, did the article tell you how much more money that 1% made in comparison to that 95%? Until there are wages sufficient to broaden the tax base, we have no choice but to ask the earners to pay the biggest share as has always been the case. Why does investment income deserve to be taxed at 15% and the sweat of your brow deserve to be taxed at 25%?
Some of the comments on the #23 link are purely partisan (both ways), but others make valid points.
I’m sorry, that should be comment #24.
Bill, I have no objection to attrition as a means to cull any bloated system, it is by far preferable to firing people who depend on that income. But leaving jobs undone is not an option, nor are longer wait times, less productivity etc. We can indeed shrink what needs shrinking without harm, if we have the patience and brains to do it smartly.
I do not oppose any sensible reform and ways to reduce waste, fraud, abuse or bloat, not in business or government. In fact, it is long overdue. I am tired of my tax dollars supporting able bodied people who do not want to work, people who abuse drugs, property or each other, people who refuse to make any effort to better their community, people who make millions and still want subsidies, people who make millions and pay less percentage than I do in taxes and just plain bad business policy. No more private profit and socialized losses. The idea that liberals or Democrats want to support sorry people, greedy people, criminal people or the status quo on the tax structure is just not true.
Eric, the majority of Americans blame Bush for the current economy, too.
Per Quinnipac University’s recent poll: “The country is in a recession, 71 percent of American voters say, but by 54 – 27 percent they blame former President George W. Bush more than President Obama.”
http://www.quinnipiac.edu/x1295.xml?ReleaseID=1624
I may have left my point unclear by saying “consumers can only do so much”; what I meant was individual small consumers, i.e. regular folk, but the Cisco example shows that demand created by other big corporations is a necessary part of recovery, even where demand trickling up from individuals is part of their business model. In other words, Fuller’s last two paragraphs are right: executive compensation, which has not suffered, does not affect demand. Also, irresponsible financial traders, who he did not mention, can have a very negative effect on consumer demand, by their distortionary tactics, such as the unraveled CDO markets of the Wall St. collapse.
And btw, Edison, while driven to invent by business hopes, was a notably unvisionary bsuinessman who thought that dictation was the huge market for talking machines, and recorded music would never be significant. Sloan’s success was not as a creator, but in consolidation and regulatory favortism (e. g. streetcar removals). Kroc and Walton merely took existing models and expanded on them.
Eric, the rich paid more in taxes in 2007 because they made more money. The rich got richer under GWB. If you scroll down on that NY Times link you posted you will see a chart showing that the adjusted gross incomes for the top 1% grew while the incomes for the bottom 95% declined.
21
Magpie forgets the most significant comparisons of all:
January 20, 2001: GOP controls both houses of Congress
January 19, 2009: GOP controls both houses of Congress
gdad
If a person retires from the Federal Government (I think that is the employer we are talking about), they receive a very attractive federal pension – they still have income and spend money – the net effect is close, not 100%, but close to same as far as consumer demand is concerned. If a federal employee leaves the federal government for another job – one job lost/one gained.
Back to my original question – do you think it is problematic that there are about 22 million government workers and 11 million manufacturing workers in the US? I think our economy is better served figuring out how to increase jobs that actually create value added products and services in the private sector rather than increasing government jobs (like the current Administration has done) that you and I are paying for in the form of taxes.
“Magpie forgets the most significant comparisons of all:
January 20, 2001: GOP controls both houses of Congress
January 19, 2009: GOP controls both houses of Congress”
Uh, that’s a comparison?
BP,
Do you have numbers to substantiate the increase in federal employment under Obama vs. Bush? I believe most of the money has gone to banks and/or private companies for road-building and other “shovel-ready” (ahem) projects.
http://thinkprogress.org/special/2011/07/20/273795/ten-years-ago-bush-tax-cuts/
Nearly 10 years ago today, on August 1, 2001, the Associated Press reported that the Treasury Department was tapping $51 billion of credit in order to pay for the budgetary cost of the first round of Bush tax cuts’ rebate checks. The AP reported at the time that Democratic Party opponents of the tax cuts worried that they’d return government budgets to “red ink“:
Sandi you do understand the need for anonymity on the internet don’t you?
As for taxing the wealthy if they are paying 95% of the tax is that not enough? How much is enough?
“American voters say, but by 54 – 27 percent they blame former President George W. Bush more than President Obama.”
The same poll says:
Americans overwhelmingly disapprove of President Obama’s handling of the economy”
Why haven’t Obama’s plans & legislation changed anything? Is that Bush’s fault to? Is that going to be Obama’s reelection slogan? Why isn’t this socialism working?
“Reelect Obama in 2012 cause it’s still Bush’s fault!”
#41 I’d like to see those government worker stats of your Bill. According to the Bureau of Labor Statistics, government employment has been falling since the second half of 2008. I’ll help you with the math — government jobs have declined the WHOLE TIME Obama has been president.
http://www.bls.gov/news.release/empsit.nr0.htm
I’d love to see more manufacturing jobs return to the U.S., and guess what? They grew last year under Obama for the first time since 1997!!!
Eric, come on.
If you disclosed on this blog that you were an accountant, or a physician, or a trash hauler — or that you have a BS from Tech, or a BA from Liberty (online), or a Phd from Duke, none of that would compromise your anonymity one bit. Really.
#47 I don’t know, Dan, if Eric tells us he/she went to Tech, we might be able to pick him/her out of their 220,000 living alumni.
#42- Dan, what in the world? What does that have to do with the figures given in my comments #21 & 25? That’s like saying Reagan was President in January 20, 1981 and GHW Bush was President in January 20, 1989. Those are both true also, but they have nothing to do with the facts in my posts. Is this some kind of “Six Degrees of Kevin Bacon” type of game?
DC (lol),
I’ll try to find a link and post it. The figures were in a WSJ article I was reading. To be perfectly open and honest, I will say that the article mentioned that the trend started under GWB but increased under Obama.
Sure I “think it is problematic that there are about 22 million government workers and 11 million manufacturing workers in the US” but that is because almost all manufacturing jobs went overseas, not because there are no workers. Also, there are millions more private sector workers so why compare government to only manufacturing and not all private employment? 22 million out of 156 million workers is 15% and hardly indicative of some socialist plot.
I agree that “our economy is better served figuring out how to increase jobs”, but I also do not agree that government workers do not “actually create value added products and services” Since police, fire fighters, FBI, CIA, and the military are included in that “government worker” rubric, I have no problem with 22 million working for 306 million as raw numbers go.
I also do not believe that the current administration has increased government jobs as you accuse.
From the link Gdad offered: “Employment in government continued to trend down over the month (-39,000). Federal employment declined by 14,000 in June. Employment in both state government and local government continued to trend down over the month and has been falling since the second half of 2008
Manufacturing employment changed little in June. Following gains totaling 164,000 between November 2010 and April 2011.”
Bill P
I understand what attrition is. But that is not what the axe the Republican Congress is trying to apply to the feseral budget is about. The CBO has estimated that the Ryan budget would almost immediatyely result in the loss of 750000 jobs and this ridiculous cut cap and balance plan is even more radical. And that still does not take into account the additional jobs that will have to be cut by state and local govts due to reduced federal funding. As a matter of fact, the Republicans in Va. assuming they maintain control of state govt. will be hard pressed to find money to replace the 1.5 billion federal stimulus money that it used to balance this year’s budget. Logic says that job losses will be greater than 1 million and then the Republicans will be screaming because the unemployment rate is over 10%. You can’t have it both ways.
#42- Oh, sorry Dan. I just realized that you were quoting someone, so the bizarreness of that comment makes a little more sense now. Well not more sense, but I understand it better.
“January 20, 2001: GOP controls both houses of Congress”
Here’s that statement by the Federal Reserve Bank of NY again…
“From 1999 though the end of 2006, the United States financed a string of large current account deficits by borrowing $4.4 trillion from other countries—a sum amounting to 85 percent of total net borrowing worldwide.”
Also there’s this. This was the Congress for that date. Also keep in mind that Bush didn’t veto anything his first 6 years in office…
107th Congress: Republican Majority / Bush President
Spending Increase Bills- 653
Spending Decrease Bills- 37
-vs- the 104th Congress
104th Congress: Republican Majority / Clinton President
Spending Increase Bills- 316
Spending Decrease Bills- 250
Referring to that second quote- which was even more strange- “January 19, 2009: GOP controls both houses of Congress”
On January 19th, 2009 the Democrats had majority control of both. On November 2, 2010 Republicans re-won control of the House (112th Congress began 1/3/2011). The Democrats still have majority control of the Senate.
I freely admit I find the BLS website hard to navigate and mine for info, but these numbers are supposedly pulled from there:
“The federal government employs about 2.7 million people.
State governments employ about 5 million people.
Local governments employ about 14 million people. ”
http://askville.amazon.com/SimilarQuestions.do?req=average-percentage-cities-population-employed-people-computers-daily
I assume that those 14 million local folks are all the teachers, librarians, cafeteria workers, bus drivers, maintenance workers, police officers, fire fighters, etc and I doubt many communities feel they have too many people working.
I will keep looking for further breakdowns but I just do not agree with all the bloat people keep insisting is there.
@12.
Bill Purdue,
Isn’t only the first $1 million or so of the top officers wages currently tax deductible by the IRS? That includes CEO, CFO, COO etc. You may want to check the current IRS code before you start creating new laws
OK, I found this for Federal Employees:
http://www2.census.gov/govs/apes/09fedfun.pdf
2.8 million
State Government:
http://www2.census.gov/govs/apes/09stus.txt
3.8 million
and Local government:
http://www2.census.gov/govs/apes/09locus.txt
11.1 million
One of the things Bill Gates and Microsoft did to create future demand for especially Windows Operating System is he gave millions of copies of it away to colleges and universities in order to get it adopted as the mainline operating system used to train future computer scientists, engineers etc. Colleges had to either the newer editions of Windows or buy different operating systems and retrain everyone. It was a brilliant stroke of genious(sp).
My post 40 should have read
January 20, 2001: GOP controls both houses of Congress
January 20, 2009: Democrats control both houses of Congress
That’s all you need to know about the downturn that started in 2007
I also do not believe that the current administration has increased government jobs as you accuse.
It doesn’t matter what you believe. The fact is, Zero Boy has increased federal jobs by over 100,000. I found this information in about five seconds.
#50 Sorry, Bill, but as I posted, government employment has gone down the whole time Obama has been in office.
#49 Dan was quoting what one of our trolls posted to you, Magpie.
LOL.
ONLY the first $20k per WEEK of top officers’ salary is tax deductible as a business expense!?
What an outrage! What apostasy! What a friggin’ pity! How can capitalism possible survive under such onerous regulation?
What’s next, for land of the rich, and the home of the greed?
“My post 40 should have read
January 20, 2001: GOP controls both houses of Congress
January 20, 2009: Democrats control both houses of Congress.”
Oops! Looks like somebody lost another one.
Just googling numbers of federal employees you can find a huge number of posts from different groups and each of them seems to have different numbers and you can cherry pick what you want. Politifact estimates that the net gain in federal employees from Jan. 1 2009 to March 1 2011 is about 58000. It also says that employment has trended down since then and that some of that net gain has now been lost. The actual number of federal employees has decreased from 3.06 million under George H>W> Bush to approximately 2.65 million now. However, the privitization of so many
federal functions beginning with the Reagan years and extending to now
means that those figures seriously under report real employment. The numbers of workers hired by the private contractors who do huge amounts of work for the defense dept. are not included in this total.And there does not seem to be an authoritative source for what this number is.
There are also large numbers of private contractors employed through the GSA and the State Dept. But as far as people actually on the federal payroll, the number now is at its lowest point since 1962. And there are decidedly not 22000000 federal employees. Adding federal, state, and local numbers of govt employees together does not even reach 22 million.
dave, I would imagine that most of the 58k increase in federal employees you mention was caused by the 2010 U.S. Census. As I’m sure you know, that’s required by the Constitution.
BillP
Now lets talk about a real number. Cutting 750000 jobs out of 2.65 million
creates a bit of a different picture. Rounded off that’s about 29%.
In this discussion of the worth of entrepreneurs and their relationship to consumers’ needs, I just saw and read of the company expanding in Roanoke by a VT grad, called Maxx Performance. The company specializes in “encapsulation” and you can find out more at http://www.maxperform.com. I dare say the concept of “encapsulation” never crossed the minds of most consumers.
This real-tme example is simply to show that entrepreneurs are generally leaders in the consumers’ markets with ideas, innovation, and creativity, in developing those markets for jobs, of which Maxx Peformance intends to add 15 new employees.
I’ll close with a probably over-used caveat…there are those who do, such as entrepreneurs, and there are those who teach how or why it can or cannot be done, such as collegiate professors; of which America needs a lot more of the former and a lot less of the latter.
You may want to read “Re-Greening the Deserts”? http://theroanoketribune.com/catalog_25.html
Oops! Site Correction for Maxx Performance http://www.maxxperform.com
#62- gdad, yeah I caught the quotation marks later on. I was trying to read the blog, and the kids started arguing behind me. I obviously wasn’t paying close enough attention to Dan’s comment. Then I had to go do the “parental step-in” when the fighting escalated. I swear this extreme heat and humidity is making all of us a little crazy, and it looks like we have more of it today.
It just threw me, because I saw that “he” was proving my point about much of this starting under Bush and just continuing under Obama. But the tone of the comment sounded like it was trying to dispute that.
Mr. Buck, are there people who pay you for your writing? Your insult to teachers and elevation of entrepreneurs was disgusting IMO. Altruism is something that many people cannot grasp. Maybe you should do some reading.
#68 Bobby Buck, you either forget, didn’t know, or simply ignore the fact that entrepreneurs like the one who heads Maxx often earned their degrees and learned their stuff at public universities from the professors you want fewer of. Winston Samuel earned his master’s and doctorate from Virginia Tech. It wouldn’t surprise me to learn that the foundation for the technology he uses was developed at a place like Tech by professors like the ones you so disdain. Using public funding.
Thank you Ms Saunders and “gdad” for your comments. Let’s see if I be slightly clearer with my aforementioned assertion about professors and what you may call “personal disdain.” In a blog from my website, I stated that America should start consolidating institutions of higher learning based on their output in performance.
America’s educational institutions have become deficient in our staying in the role of global leadership…and, I think that’s due to teachers and professors who have become lackadaisical in their tenured positions.
Admittedly, there are some great teachers in our overall educational system, of which I cited Mr. Steel, a physics instructor at Liberty High School, and Dan mentioned a math and science teacher by the name of Mr. Benzak, I believe, at Patrick Henry.
When on the collegiate level, teachers or professors give reasons why someone(such as entrepreneurs) can’t get something done, instead of being knowledgeable enough to teach how and why it can, that professor should be fired…simply put.
“And opinions, albeit some backed by facts, are exactly what we post here as well. Some people do confuse the two, but oddly enough the people that Eric, Scott and others listen to daily are also just offering opinion or analysis and they never seem to make that connection.”
Sandi, oh please don’t mistake me for one of those right wing idiots that listens to talk radio all day.
I’m much smarter than that. I’ve taken classes that deal with critical reading and thinking.
Just to clarify. I think we all have the right to an opinion, and we express it here as such, every day in this sort of de facto “comment community”. But I think it is obvious to even the layman that any single poster is not going to be an expert in every field. I am an electrical engineer, so I can talk about power, lighting, green engineering, etc… with some degree of expertise over the average consumer. Richard Beason can talk about taxes and other economic mumbo jumbo that I don’t understand as well because he’s a CPA (or at least his login name claims him to be!)
But then you have these editorial “features” for lack of a better term that seemingly are written by anyone with an opinion. I would argue it’s irresponsible to give a showcase to someone without an informed opinion. And believe me, I’ve read many of them that couldn’t possibly be informed.
THAT is the issue I have. I don’t want to stifle opinions, because I like reading differing viewpoints. But in these opining debates, there is some factual data, which sometimes is incorrect. When that data is in a “feature” written by someone without an informed opinion, I think that becomes reckless. You wouldn’t expect to believe anything written in a technical paper on 480 volt 3 phase power systems written by a retired dentist would you?
#73 That’s Ben Bazak at PH.
Sandi, Dave and gdad,
Sorry I haven’t responded yet. I was float fishing on the upper James yesterday. We caught and released over 30 smallmouth bass each.
I will find and post the article I was refering too this weekend. I can’t post links from my Blackberry.
BTW, the 22 million was total government jobs. Somehow, we got off on just feferal piece. Sandi, I don’t think there is a socialist plot afoot. In broad terms, my opinion was that if 700000 government (all) wre eliminated via attrition over time, it wouldn’t be a huge hit to the economy. I’m not against teachers, fire fighters, etc. I do think government (all) can become more efficient.
#76 Bill, hope the fishing was good.
Saw a story last night that reminded me of another reason that we’ll NEVER see manufacturing jobs come back like they once were — automation. The story featured a family-run custom steel parts factory that is quite profitable and is getting ready to spend $1.5 million on technology — and zero on hiring new employees. One part that used to take 18 men 30 minutes to make is now done by a laser in 30 seconds.
There’s nothing any of us can do about that, and it’s not Obama’s fault, either.
Gdad
There has to be a way to blame that on president Obama too. Lol
#77, true, and until we can execute some sort of game plan that rewards companies for setting up their manufacturing in the US with US employees – and alternatively discourages them from doing otherwise – I don’t see much hope for the domestic manufacturing sector to offer many jobs.
gdad
You’rer right. On the other hand, somebody has to build the laser and the housing for it. And the other technological equipment used in the automation process.
A lot of those computer automated things got started in the 1980s – computer controlled machines that would carve stocks for rifles and also machines that shaped wood for electric guitar necks. There are jobs available programming and running the computers and machines, but the need to have people running a lot of machinery is not what it used to be.
Technology is here to stay, and there’s no denying the progress. It will simply increase human displacement in the long term future. As a nation, we will either saddle up and ride it like the wind, or be thrown for an everlasting loss. I alluded to this in my initial thesis video back in 1992…available at http://infobuck.com/index.html
Thanks Bill Perdue, we bascially agree then.
Scott, thanks for the clarification and we agree also, I hate that opinion with false “facts” is printed because it does lend a credibility that is undeserving.
Mr, Buck, I simply disagree. While tenure can make anyone lazy, a teacher who knows their subject and imparts that knowledge and passion is a gift and there are plenty of them in schools all over this nation at every level. My son-in-law is in a masters program at Drexel that is extremely challenging and rewarding. That teacher could make huge bucks if he left and went to a private company, instead he teaches these young people to go out and do that. That is the altruistic and giving kind of people that good teachers are.
Hey Dan, it appears the Techs increased the time out on the hated “CAPTCHA Code” and it is much easier now. Please tell them Thanks!
No doubt automation, innovation and technology can be job killers but it can also be job creators. What we need is a system for retraining and redeploying employees displaced. On the other hand there are areas like electricians, plumbers, mechanics and folks who still know how to do things “old school” that are and will be “in demand”. I would recommend any of those to anyone not going for college or another career.
Ok, here’s the source on the growth of federal jobs. Like I said in a follow-up post, the trend started under GWB:
http://blog.heritage.org/2011/02/22/federal-workforce-continues-to-grow-under-obama-budget/
“St. Louis Fed: Local Governments Have Shed Approximately 416,000 Jobs Since 2008.
State Governments Have Shed Approximately 90,000 Jobs Since 2008.
Income Strategist: While Private Sector Jobs Increase, State, Local Governments Will Cut 20,000 To 30,000 Jobs A Month Through At Least End Of 2011.
Economist Zandi: State, Local Cuts Could Keep Unemployment From Falling Below 9 Percent By End Of 2011.
http://mediamatters.org/research/201104110026
Now you can argue that Media Matters is as biased as you like (I disagree), but they are certainly not more biased than a Conservative blogger on the Heritage website.
My knowledge of business history is better than I remembered. And by the way, thanks for making my point. Kroc, Gates, Jobs, all anticipated a market and risked the capital. Walton did create an inventory management system that enables Walmart to do what it does today, another big risk on his part. No capital risk by the entrepreneur, no benefit to the consumer, no jobs. Thanks for the business history lesson. Oh I almost forgot, remember the Edsel? Not all risk is rewarded with success but it still costs a lot of money.