Unemployment: The Big Lie
The U3 unemployment number fell to 9% according to the Bureau of Labor Statistics. This change in the unemployment rate was not due to increases in the number of people being employed, it was due to the number of people who have quit looking for a job. According to the Associated Press the U.S. added 36,000 net new jobs last month. This is not enough to even keep up with the growth in population. Even this meager number is suspect, since the number of net new jobs has consistently been revised downward in the last several months. If we want to create jobs, we need policies that encourage job creation. Here is a straightforward list of policy changes that would create jobs.
1) Repeal Obama Care
This legislation has created uncertainty about the cost of insuring employees. Note that over 700 employers and unions have asked for waivers.
2) Fully Fund the Patent Office
High quality, high paying jobs are created by new businesses built on new technologies. The backlog of unexamined patents at the Patent Office is keeping many start-ups from receiving funding. According to the Kauffman Foundation, all net new jobs are created by new business.
We should also strengthen our patent laws. For more information see Larry Kudlow: Chinese Economy Relies of Stealing US Intellectual Property.
3) Repeal Sarbanes Oxley and the Frank Dodd Financial Reform Act
New companies require financing to create jobs. Traditional banks mainly fund low tech companies that create low paying jobs. High quality, high paying jobs are created by new businesses built on new technologies and require financing (usually equity) that is not provided by traditional banks.
4) Radically Cut Government Budgets and Taxes
Government budgets have grown to over 44% of the economy (about 26% at the Federal level) and this takes money and resources away from the private sector. Taxes obviously increase the cost of doing business. The higher the cost of doing business the fewer employees that will be hired.
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