Layoffs And Unemployment - What's The Solution?

The following two articles on the state of employment and layoffs are very informative and need to be read and understood. I think they do a great job of explaining the physiological ramifications of layoffs and unemployment, but both articles don't offer a clear way of trying to explain what needs to be done to fix societies problems. We all know why there are layoffs and why employment is in the tank. DUH! Its the economy stupid! What's the plan to rectify the situation? How do we stop layoffs and get the economy adding jobs? These are complicated questions and maybe the authors aren't authorities on economics or world finance, but by just talking and writing how depressed people are doesn't get us the solutions to what truly ails us. It gives us what happens after layoffs and unemployment hits the economy, and how the world is going to look like 10-15 years from now. But by not properly diagnosing the reason we have layoffs and lost jobs, it underscores and underestimates(If that's possible)how potentially more depressing life is going to be not 10-15 years, but 5 years from now. We need to ask and analyze the tough questions and issues that are staring us straight in the grill every day. How did we get here? Why did we get here? When are we going to make tough sacrifices? What are the real world solutions? These questions are not asked so nothing is answered except reverberating millions of people's painful stories.

The Case Against Layoffs:
http://www.newsweek.com/id/233131

This next article I included in my Indications Of Interest (Links). Its a long and depressing read.

How A New Jobless Era Will Transform America
http://www.theatlantic.com/doc/201003/jobless-america-future

So what's the solution? What's the answer to our problems?

First of all we have to figure out how we got here? We got here because our economy and nation are on a dangerous path towards insolvency. Forget the banks, they are already insolvent. Its really our government that we all should be worried about. Every part of our economy is on a fiscally unsustainable path:

1-Health Care
2-Defense Industry
3-Wall Street and Banking
4-Social Security
5-Consumer Spending & Revolving Credit
6-Housing
7-Taxes
8-National Debt

I can add roughly 10 other items here that are equally in horrible shape, but it goes without saying that the extend and pretend policies of our government have completely ruined our once great nation. Its not the question of too much spending, but where its actually going that is absolutely ludicrous. Why do keep fighting two wars you ask? Well because there is a defense industry that needs wars to survive. Its a bloated bureaucracy that's been raping the American public for 30 years. The industrial military complex has gutted America. The GOP/Right have brainwashed America into thinking we need a $700B Defense/Military Budget to keep America safe. This is flat out treason by our elected officials. Boeing, Lockheed Martin, Litton, Northrup, and other military contractors have gotten enormously wealthy and powerful from just preying on the weakness and fears of the tax payer. It's these fears that the defense lobbyists build on to get what they need from Congress. Congress then uses this in a two prong way. First, we need to protect Americans, and secondly we need to protect American jobs. They use national security and jobs as a springboard for campaign contributions and to pull the wool over America. There have been many articles written that say that a military/defense spending actually costs the economy jobs and screws the economy long term without even protecting America.

What we have in our country is the permanent War Economy that is merged into the perennial Corporate State.

Our Wars Are Killing Us.
http://www.commondreams.org/view/2010/01/27-3

The Obscenity Of US Military Spending
http://tpmcafe.talkingpointsmemo.com/talk/blogs/o/l/oleeb/2010/02/the-obscenity-of-us-military-s.php?ref=reccafe

Military Spending is Increasing Unemployment
http://www.georgewashington2.blogspot.com/2009/11/military-spending-is-increasing.html

Like everything else in our country our elected leaders have it ass backwards! Obama comes out with his budget and the places where he needs to slash and burn aggressively he increases spending. Look at the military budget? Increase! Look at Medicare/Medicaid? Increase! All of these bloated programs that have made business's and citizens billionaires at tax payer expense get increased federal assistance. While these blood suckers get rich, the rest of us have to "freeze" or cut back. Obama's budget is such a joke that its hard to believe this is the same guy who got elected in November 2008.

Bruce Bartlett has a great article on the Obama Budget.

Why Obama's Budget Was DOA This Week
http://www.capitalgainsandgames.com/blog/bruce-bartlett/1473/why-obamas-budget-was-doa-week

Defense Spending along with other entitlement programs have destabilized and bleed our economy to the point that mass layoffs and unemployment are generational problems. What is Obama's plan? Lets keep fighting in Iraq and Afghanistan! Lets not explain Health care to the masses so they understand the enormous drain that it is on our economy and country! The simple fact that Obama let Geithner/Summers/Bernanke/Congress muck up financial reform and let Wall Street become another casino is truth that Americans didn't believe in Health care reform, regardless of it actually reducing the deficit or not. The way Obama let Wall Street go back to doing business as usual with speculative trading and absurd bonus payments only outraged the electorate more. Obama had a chance to get real reform and regulations. He delayed and failed. He did the right thing with the auto companies. Why didn't he do the same with the banks? He was simply following the money. He had no stomach to deal with the traitors in his own party that were already in the pockets of Goldman Sachs and JP Morgan. The same ones who had ruined the economy were now running up commodity prices again and paying out huge salaries as the vast amount of Americans were still feeling the pain. Obama lost the center of the country when he allowed Geithner to rape the tax payer so that Goldman officers in and out of government can re load their bank accounts.

We have to figure out a way to make our economy less susceptible to these boom/bust cycles. In great economic times every one is having such a good time spending money that they don't have. When times get tough they cut back. We have to figure out a way to get out of this cycle of debt. Americans are already in a severe deleveraging cycle, who are worried about retirement. They are furiously paying back debt and in some cases just outright defaulting on them. To bad our government just wants to reset the same old broken clock. They are sinking further into debt just hoping against time and good reason that the old guard that performed so well in good times can be restored. This is unacceptable!

Why do we have layoffs and unemployment? Read above! Its the economic boom/bust cycle. A cycle that is financed with money we don't have. The entire world much less or own economy is dominated by the 2 C's. Credit and Crude. We don't have any policy accept business as usual to get out from underneath both of them. Why? Big Business! We have sold out American Tax Payers so that Big Business can dominate. I understand that big business employs millions of Americans, I am not stupid, we do need US companies to be strong, but to what extent? Why have we destabilized our own economy to get there? Why have we allowed big business to run not only foreign policy, but monetary and fiscal policy as well? In fact, big business runs every policy in our country.

Ever since Nixon got us off the gold standard, we have had exploding deficits and debt. When Bretton Woods died the dawn of International Casino Finance/Banking was born. The death of Bretton Woods was a central bankers wet dream. They no longer had to align gold reserves to money supply. They were free to print. Print money and issue debt to finance big business's take over of the world. Ever since the entire world was in this cycle of debt that only brings the classic boom/bust economic cycle to the masses. This is why we have layoffs. Classic overbuilding followed by a painful bust. Jobs are created then severely cut. Sooner or later we were bound for a serious bust. Let me tell you we have not seen the worst bust as of yet, that is because central bankers and policy makers around the world keep spinning debt and printing money to refinance and reload the global casino. What we are headed is a massive debt deflation that will make the events of 2008 look like cub scout jamboree. These guys are in a desperate attempt to revive old bubbles and bad practices. Its a classic race to the bottom.

Second reason we have layoffs is that Wall Street likes them. We hear all of the time from Wall Street analysts that companies need to downsize and cut overhead. You don't think CEO's listen to this? CEO's are in profit mode 24/7 and they know what analysts and money managers want. Its a classic circle jerk between Wall Street's interests and Corporate America. All of the parties involved know what buttons need to be pushed. Ludicrously, this is the business that everyone is trying to save and the tax payer is financing it.

We must drastically cut the defense/military budget. Get the heck out of Afghanistan and Iraq as soon as possible and never mess with the Islamic World ever again. If the Muslims want to pray to Allah 50X a day and have their women wear veils so be it. If they want to live in the 7Th century, so be it. The Muslim World has been fighting with each other since Mohammad died some 1378 years ago! Why are we in the middle of these lunatic actions? These two wars have killed America's resolve and soul while only making Defense Contractors and Black Water better off. Get the heck out of Afghanistan and Iraq!

We must drastically raise taxes! God Damn It! I said it! We all have to pay for the damage that has been done. The stupidity of two wars and the trillions of corporate giveaways is the taxpayer's responsibility because we stupidly believed in our elected officials. Shame on us! There is no way around it. No feasible deficit/debt reduction plan is reasonable or should be taken seriously without higher taxes. Any plan that omits higher taxes is just a scam. Maybe, just maybe we all get pissed off enough paying more taxes this time around we won't be suckered by our elected officials into needless wars and bailouts. This type of beneficial outrage is what is needed.

We cant get out from underneath the credit problems overnight, but we can start somewhere, and making the banks take their medicine is a step. We need to get the bad debt and loans out of the system. Japan didn't do this and twenty years later they are wondering around in a deflationary trance.

http://tradersutra.blogspot.com/2009/06/why-we-look-lot-like-japan-in-90s.html

http://tradersutra.blogspot.com/2009/11/is-japan-really-in-trouble.html

http://tradersutra.blogspot.com/2009/07/japan-redux-if-we-are-lucky.html

Making the banks accountable is the first step. Secondly, after our next meltdown, we have to get serious about financial reform. We have to close the casino that was opened 40 years ago. You want to gamble? Go visit Vegas, Atlantic City, or Macao stay away from our deposits!

We have to strengthen our dollar and the only way to do that is incredibly a strong dollar policy. We cant keep having a Zero Interest Rate Policy. This is why we have asset bubbles that keep boom/bust cycles alive. Why are we breaking the Chinese chops about the way they handle their currency, when we have been wrecking ours for the better part of 100 years?

I am not saying that doing all of these things is automatically going to bring back jobs to our shores and create millions of jobs overnight. Most of our markets are in a secular downturn. There is no silver bullet or easy way out. Some jobs are never coming back because they depended on the fake structured finance economy of the last decade for survival. We are in a deep world of pain because of bad mismanagement of our national finances by technocrats who gave away the farm. Its not happening overnight or even in the short term. If we realize the reasons why we are in the abyss, maybe we can figure out how to get out? The layoffs will come, unemployment will grow because policy makers have not figured it out.

I know many will say these solutions are not implementable. Its not happening. Its not realistic. Bullshit! These are the type of attitudes and rhetoric that has poisoned our political and economic process, only once we start to make these terribly painful choices will we be able to rebuild America the right way.

I don't have all of the answers and solutions, after all I am still relatively young, but my experience tells me that what ever we are doing is just a failed attempt to get out of a bust situation back into a boom situation really quickly so that the same old bad policies and practices can just resume like nothing happened. This may or may not work, but much sooner rather then later its all going down the drain and there will be nothing that our elected officials and society can do except start counting the dead bodies on Wall Street, K-Street, and Main Street.