How to Create a Job that has Value

Foxfyre

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NOTE TO MODERATORS: This is in politics for a reason and WILL relate to the current politial environment!!!

What is a job that has value as opposed to a 'make work' job? How are jobs with value created?

So who has the better plan?

The President who wants to spend more money to 'create jobs', who wants to tax the rich more, who wants to regulate everything more, who promotes legislation with heavy impact on present and future job creation?

Or the Tea Party Conservative Republicans who want to lower taxes on job creators, want to reduce regulation on job creators, and want to make policy permanent enough to encourage job creators to release trillions of investment capitol they are now sitting on?
 
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the best plan might be to put a freeze on the federal register for a year.

The big complaint most business has is they can't budget for the new regulations.
 

Dragon

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The best way to create a job that has value is to boost wages for the jobs that already exist. This will increase demand for consumer goods, which will increase demand for labor to produce those consumer goods, which will create jobs.

Another way, not quite as good but not completely awful, is to put money in the hands of consumers some other way, e.g. through government work programs, tax cuts for the middle class and working class, or payment of benefits such as UI. This also creates consumer demand but not as effectively or broadly as an increase in wages.

The worst way to create a job that has value is to cut taxes for big business on the mistaken idea that businesses create jobs because money burns a hole in their pockets. Businesses create jobs because there is unsatisfied demand for the goods and services those jobs create in turn. How much money they have/keep/whatever makes little or no difference.
 

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The best way to create a job that has value is to boost wages for the jobs that already exist. This will increase demand for consumer goods, which will increase demand for labor to produce those consumer goods, which will create jobs.

Boost wages of existing jobs will result in higher costs for goods and no net gain.

Another way, not quite as good but not completely awful, is to put money in the hands of consumers some other way, e.g. through government work programs, tax cuts for the middle class and working class, or payment of benefits such as UI. This also creates consumer demand but not as effectively or broadly as an increase in wages.

Money is in the hands of the consumers via existing jobs, unemployment insurance, welfare and food stamps. Increase any of that will result in no more demand. People dont spend more than what they do on their essential needs unless they have a permanent means of income. If you wee unemployed and someone gave you some extra money....what would you do with it?

The worst way to create a job that has value is to cut taxes for big business on the mistaken idea that businesses create jobs because money burns a hole in their pockets. Businesses create jobs because there is unsatisfied demand for the goods and services those jobs create in turn. How much money they have/keep/whatever makes little or no difference.

Yes, businesses expand to meet the demand for their product or service, but not if they feel that the net result is 0 gain. When you expand, there are an increase in risks...and if your net gain will be zero, why risk expanding?
The answer is

"stop giving business owners reason to think another bomb is going to drop affecting their success"
 

Dragon

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Boost wages of existing jobs will result in higher costs for goods and no net gain.
No, the gain in wages will far outstrip any increase in prices. We have plenty of historical examples to prove this.

Money is in the hands of the consumers via existing jobs, unemployment insurance, welfare and food stamps. Increase any of that will result in no more demand.
This assumes that people already have everything they need, which is not the case. As for your theoretical question about unemployment, we have a very recent example disproving your idea.

Yes, businesses expand to meet the demand for their product or service, but not if they feel that the net result is 0 gain. When you expand, there are an increase in risks...and if your net gain will be zero, why risk expanding?
True, but you should question whether that "if" is based on a false premise.

The answer is

"stop giving business owners reason to think another bomb is going to drop affecting their success"
All business owners know very well that bombs can drop any time. If every business owner were to somehow feel perfectly confident that nothing is going to change in government regulations, taxes, or economic essentials for the next twelve months, they would still not invest in job-creating activities because there would still be a dearth of customers.

While too much insecurity can also depress investment, I know of no historical incidents of this that didn't involve major war or huge natural disaster. A minor flux in taxes or government regulations comes nowhere near the magnitude of uncertainty required.
 

alan1

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NOTE TO MODERATORS: This is in politics for a reason and WILL relate to the current politial environment!!!

What is a job that has value as opposed to a 'make work' job? How are jobs with value created?

So who has the better plan?

The President who wants to spend more money to 'create jobs', who wants to tax the rich more, who wants to regulate everything more, who promotes legislation with heavy impact on present and future job creation?

Or the Tea Party Conservative Republicans who want to lower taxes on job creators, want to reduce regulation on job creators, and want to make policy permanent enough to encourage job creators to release trillions of investment capitol they are now sitting on?
If we take exactly half the unemployed people and use government (tax payer) money to pay them to dig holes, AND, then we pay the other half to fill in those holes (also with tax payer money), we have just created 100% employment, and everybody has a job. there is no value in those jobs, but yay us for achieving 100% employment.

Or

I could go on vacation and create jobs.
See, I could fly someplace, that would mean an airline pilot, flight attendants, ticket agents, airplane mechanics, control tower employees and yes, even the guy that cleans the bathroom at the airport all have a job.
Additionally, I would stay in a hotel. The desk clerk, the maid, the builder of the hotel and the people that work in the bedding factory that supply the hotel will all have jobs.
I'll visit restaurants when I am on vacation. The chef, wait staff and the dishwasher will all have jobs. So will the growers of the produce or ranchers that supply food to the restaurant, as well as the food delivery person for the restaurant.

Me spending money is an endless supply of jobs for people, jobs that provide value. Me giving my money to the government to spend is just full of waste.
 

Uncensored2008

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The best way to create a job that has value is to boost wages for the jobs that already exist. This will increase demand for consumer goods, which will increase demand for labor to produce those consumer goods, which will create jobs.
Since 2008, the wages of federal workers has risen 22%, California state workers have seen 36% more in income (AB 2462.)

So why is it that California has the second highest unemployment in the nation? Why does national unemployment remain over 9%? Why are we right back in a recession when we never recovered from the last one?

Why didn't the opulence provided our government aristocracy increase the demand for labor to produce consumer goods as you claim?

Another way, not quite as good but not completely awful, is to put money in the hands of consumers some other way, e.g. through government work programs, tax cuts for the middle class and working class, or payment of benefits such as UI. This also creates consumer demand but not as effectively or broadly as an increase in wages.
So unemployment is the path to prosperity?

The worst way to create a job that has value is to cut taxes for big business on the mistaken idea that businesses create jobs because money burns a hole in their pockets.
Maybe if we put a 100% tax on all business, the economy will be booming?

Businesses create jobs because there is unsatisfied demand for the goods and services those jobs create in turn. How much money they have/keep/whatever makes little or no difference.
You've got it all figured out. Funny that you don't own a business of your own and are stuck in a government job.....
 

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Or the Tea Party Conservative Republicans who want to lower taxes on job creators, want to reduce regulation on job creators,


Yeah, only this is the right way to create more jobs.
 

Uncensored2008

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No, the gain in wages will far outstrip any increase in prices. We have plenty of historical examples to prove this.
No, we most certainly don't. Even Keynes didn't promote such nonsense.

This assumes that people already have everything they need, which is not the case. As for your theoretical question about unemployment, we have a very recent example disproving your idea.
You assume that no one will save or service debt with the free money, and that the goods they buy will be domestically produced.

All of these are faulty assumptions.

True, but you should question whether that "if" is based on a false premise.
Why?

That business expands and creates jobs when the risk of doing so is less than the gain offered is a matter of established fact.

All business owners know very well that bombs can drop any time.
The bombers are circling at this moment, with Obama leading the assault.

If every business owner were to somehow feel perfectly confident that nothing is going to change in government regulations, taxes, or economic essentials for the next twelve months, they would still not invest in job-creating activities because there would still be a dearth of customers.
That is an utterly stupid claim.

While too much insecurity can also depress investment, I know of no historical incidents of this that didn't involve major war or huge natural disaster.
Really?

Can I introduce you to 2008?

A minor flux in taxes or government regulations comes nowhere near the magnitude of uncertainty required.
Where do you get this nonsense? What you post is incredibly ignorant and shows zero grasp of basic economic principles. Are you Paul Krugman?
 
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Foxfyre

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Boost wages of existing jobs will result in higher costs for goods and no net gain.
No, the gain in wages will far outstrip any increase in prices. We have plenty of historical examples to prove this..
The ONLY gain in wages that will produce the results you suggest are those based on the VALUE of the work performed. The thread title is how to create a job that has value. In the introduction to economics, we all should have learned that labor is a commodity just as energy, raw materials, transportation, and facilities are commodities that go into the price of a product. There is an optimum value on the labor that produces an effective work force that facilitates maximum value on the product produced.

Artificially inflate the labor beyond what its value is, and the ripple effect through the economy artificially inflates the cost of everything. Busineses are not charities and they will not hire people for which they do not receive value for the wages paid.

If your theory was correct why not raise the minimum wage to $20/hour and REALLY generate economic activity?

Money is in the hands of the consumers via existing jobs, unemployment insurance, welfare and food stamps. Increase any of that will result in no more demand.
Dragon:This assumes that people already have everything they need, which is not the case. As for your theoretical question about unemployment, we have a very recent example disproving your idea.
Every dollar the government pays to anybody for everything has to be printed and if more are printed than the economy is generating, everybody's dollars are reduced in value meaning they will need more of them to buy anything. And if the government taxes others to give more 'necessities' to those who don't have them, every dollar taxed is a dollar that is not available to increase wages or benefits, to expand businesses, to invest so other businesses can grow, to save for others to borrow as venture capital, or to hire new people.

Yes, businesses expand to meet the demand for their product or service, but not if they feel that the net result is 0 gain. When you expand, there are an increase in risks...and if your net gain will be zero, why risk expanding?
Dragon
True, but you should question whether that "if" is based on a false premise.
Absolutely not a false premise. If the odds are against the money I invest providing a reasonable return, I'm not going to invest it. If I don't know what the tax and regulation policy is going to be six months from now, a year from now, two to ten years from now, I am not going to risk the investment capital I have and wind up with nothing. I'll just hold onto to which is unacceptable, but at least not as dangerous as losing it all.


The answer is

"stop giving business owners reason to think another bomb is going to drop affecting their success"
Dragon
All business owners know very well that bombs can drop any time. If every business owner were to somehow feel perfectly confident that nothing is going to change in government regulations, taxes, or economic essentials for the next twelve months, they would still not invest in job-creating activities because there would still be a dearth of customers.

While too much insecurity can also depress investment, I know of no historical incidents of this that didn't involve major war or huge natural disaster. A minor flux in taxes or government regulations comes nowhere near the magnitude of uncertainty required.
War is not a jobs killer. Natural disasters are temporary. But excess taxation and regulation isn't something a business can recover from. It eats away at profits and incentive, month by month, year by year. And for many businesses, it just isn't worth it. All of life is a risk and there will be winners and losers and the possibility of failure is real for anybody who takes a risk. But the businessman has no power to manage onerous taxes and regulation, and when the government is giving him NO assurance of what he can expect, he is an idiot to risk the investment capital that he has and may need to use to keep a roof over his head and feed his family.

Most especially when we're dealing with an Administration that seems to be hung up on class warfare and seems to have zero understanding of how jobs with value are created, and what runs a healthy economy.
 
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Foxfyre

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If we take exactly half the unemployed people and use government (tax payer) money to pay them to dig holes, AND, then we pay the other half to fill in those holes (also with tax payer money), we have just created 100% employment, and everybody has a job. there is no value in those jobs, but yay us for achieving 100% employment.
Acknowledging that I excerpted MountainMan's post and there was more to it. . . .

This is the perfect illustration of a job that has no value.

The holes dug benefit nobody. They need no commodities or labor that anybody else provides. The provide no product or service that anybody wants or needs. They provide no information that is not already available that would be useful to anybody.

AND, all the money used to pay and equip the workers draws money out of the private sector that could otherwise have been used to buy, build, sell, produce, save, invest, all of which would have benefitted countless other people.

Probable result in overall employment and economic impact: negative.
 

alan1

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If we take exactly half the unemployed people and use government (tax payer) money to pay them to dig holes, AND, then we pay the other half to fill in those holes (also with tax payer money), we have just created 100% employment, and everybody has a job. there is no value in those jobs, but yay us for achieving 100% employment.
Acknowledging that I excerpted MountainMan's post and there was more to it. . . .

This is the perfect illustration of a job that has no value.

The holes dug benefit nobody. They need no commodities or labor that anybody else provides. The provide no product or service that anybody wants or needs. They provide no information that is not already available that would be useful to anybody.

AND, all the money used to pay and equip the workers draws money out of the private sector that could otherwise have been used to buy, build, sell, produce, save, invest, all of which would have benefitted countless other people.

Probable result in overall employment and economic impact: negative.
Yes, there was more to it.
Sometimes I start tapping the keyboard and my thoughts move a lot faster than my fingers.
Thanks for adding to it.
 
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Foxfyre

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Now let's consider jobs that DO have value apart from the obvious immediate effect of providing a wage for somebody to use for food, clothes, shelter, transportation, etc.

First, I acknowledge that the wage for digging an unneeded hole is not entirely meaningless as it does provide a customer for products and services others need to sell. But a wage paid for a job that has no value has to draw the money from somewhere else, so the net positive effect on the economy is short lived with a corresponding long range negative effect. If the process is repeated often enough it will drain resources and the well will eventually run dry. Money is valueless unless it represents something of value.

Adam Smith, however, understood a laizzez-faire free market economy as beyond the ability of humankind to order or regulate as no human or the entire sum of humankind has the expertise or brain power to do that. Walter Williams explained it in this mini essay re the supermarket:

The average well-stocked supermarket carries over 60,000 different items. Because those items are so routinely available to us, the fact that it is a near miracle goes unnoticed and unappreciated. Take just one of those items -- canned tuna. Pretend that Congress appoints you tuna czar; that's not totally out of the picture in light of the fact that Congress has recently proposed a car czar for our auto industry. My question to you as tuna czar is: Can you identify and tell us how to organize all of the inputs necessary to get tuna out of the sea and into a supermarket? The most obvious inputs are fishermen, ships, nets, canning factories and trucks. But how do you organize the inputs necessary to build a ship, to provide the fuel, and what about the compass? The trucks need tires, seats and windshields. It is not a stretch of the imagination to suggest that millions of inputs and people cooperate with one another to get canned tuna to your supermarket.

But what is the driving force that explains how millions of people manage to cooperate to get 60,000 different items to your supermarket? Most of them don't give a hoot about you and me, some of them might hate Americans, but they serve us well and they do so voluntarily. The bottom line motivation for the cooperation is people are in it for themselves; they want more profits, wages, interest and rent, or to use today's silly talk -- people are greedy.

Adam Smith, the father of economics, captured the essence of this wonderful human cooperation when he said, "He (the businessman) generally, indeed, neither intends to promote the public interest, nor knows how much he is promoting it. ... He intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain." Adam Smith continues, "He is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. ... By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it." And later he adds, "It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest."

http://econfaculty.gmu.edu/wew/articles/09/EconomicMiracle.htm
If you are a commercial tuna fisherman, your job not only provides food for people to eat, but it also requires a gazillion other jobs being done by people who don't even know you exist in order for you to fish for that tuna.

The fellow digging that hole needs no input from anybody else and what he does provides nothing anybody else wants or needs.
 
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Uncensored2008

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You wouldn't happen to have any links that support your claim would you?
The California law was listed. In the federal side;

2008 - 2.3% COLA plus 3.5% Adjustment = 5.8% increase
2009 - 5.8% COLA plus 3.9% Adjustment = 9.7% increase
2010 - 0% COLA plus 2% Adjustment = 2% increase
2011 - 2% COLA plus 2.5% Adjustment = 4.5% increase

Total, 22% increase.

assets.opencrs.com/rpts/94-971_20100120.pdf
 

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