Mr. Obama plans to present a list of ideas to Congress on how to “jump-start private sector hiring and get Americans back to work.” Here are some suggested ideas for his list.
#1). Begin with the admission that that you, as the leader of our government, are not equipped to solve the problem of joblessness. As Margaret Thatcher said, “The fact is that in a market economy government does not — and cannot — know where jobs will come from: If it did know, all those interventionist policies for ‘picking winners’ and ‘backing success’ would not have picked losers and compounded failure.”
#2). Own up to some fuzzy thinking when you said last week that “I still consider one job lost one job too many.” This is the same mistake that Eleanor Roosevelt made when she wrote in a syndicated newspaper column in 1945, “We have reached a point today where labor-saving devices are good only when they do not throw a worker out of his job.” Jobs are constantly being both created and destroyed in a dynamic free economy. In a competitive marketplace, every employer strives to become more economical and efficient — investing in new and better equipment in order to reduce the amount of labor that is required to produce a given output.
#3). This is not — as commonly supposed by liberals — a race to the bottom. Rather, it is the real key to lifting living standards and generating stable employment. Through private sector capital investment, workers become more productive, better paid, and therefore better able to trade the fruits of their labor for what workers in other professions or industries have produced. As Thatcher said, “The right way to attack unemployment is to produce more goods more cheaply, so more people can afford to buy them.”
#4). Propping up losing companies like General Motors and Chrysler is ultimately counter-productive from the viewpoint of saving jobs. The essence of private enterprise is that businesses go out of business if they fail to satisfy their customers and provide a competitive return on investment to their owners or shareholders. The threat of failure hangs like the sword of Damocles over all business. It is a necessary and powerful incentive for improved performance.
#5). Now would be a good time to announce the cancellation of all future “job summits.” These high-level confabs bringing together leaders of industry, organized labor and government only serve to stoke the “fatal conceit” — as Friedrich Hayek called it — that it is possible to bring together a group of people who will be able to outperform the marketplace in knowing how best to run the economy. This is a socialist idea, and it has been proven wrong again and again.
#6). Now would be an even better time to announce that you have had a change of heart regarding the misnamed and undemocratic Employee Free Choice Act, which takes away from workers the right to a secret ballot in union elections. Elimination of this legislation would be an extremely positive step in restoring business confidence.
#7). One should dispense with the idea that tinkering at the edges with broad tax credits to businesses that expand their payrolls will do any good. This would have the unintended consequence of rewarding of employers that were planning to hire anyway. More to the point, however, it incentivizes the wrong thinking and behavior. Businesses shouldn’t start with the idea of creating jobs; they should start with the idea of creating value for customers.
#8). The best thing that government can do to help create private sector employment is to take less money away from the private sector by reducing both taxes and public spending. Again, as Thatcher said, “Since jobs in a free society do not depend upon government but upon satisfying customers, there (is) no point in setting targets for ‘full’ employment. Instead, government should create the right framework of sound money, low taxes, light regulation and flexible markets (including labor markets) to allow prosperity and employment to grow.”