[The US Has] Become a Nation of Takers, Not Makers

  • Posted by a hidden member.
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    Apr 06, 2011 4:47 AM GMT
    http://online.wsj.com/article/SB10001424052748704050204576219073867182108.html?mod=WSJ_hp_mostpop_read

    If you want to understand better why so many states—from New York to Wisconsin to California—are teetering on the brink of bankruptcy, consider this depressing statistic: Today in America there are nearly twice as many people working for the government (22.5 million) than in all of manufacturing (11.5 million). This is an almost exact reversal of the situation in 1960, when there were 15 million workers in manufacturing and 8.7 million collecting a paycheck from the government.

    It gets worse. More Americans work for the government than work in construction, farming, fishing, forestry, manufacturing, mining and utilities combined. We have moved decisively from a nation of makers to a nation of takers. Nearly half of the $2.2 trillion cost of state and local governments is the $1 trillion-a-year tab for pay and benefits of state and local employees. Is it any wonder that so many states and cities cannot pay their bills?

    Every state in America today except for two—Indiana and Wisconsin—has more government workers on the payroll than people manufacturing industrial goods. Consider California, which has the highest budget deficit in the history of the states. The not-so Golden State now has an incredible 2.4 million government employees—twice as many as people at work in manufacturing. New Jersey has just under two-and-a-half as many government employees as manufacturers. Florida's ratio is more than 3 to 1. So is New York's.

    Even Michigan, at one time the auto capital of the world, and Pennsylvania, once the steel capital, have more government bureaucrats than people making things. The leaders in government hiring are Wyoming and New Mexico, which have hired more than six government workers for every manufacturing worker.

    Now it is certainly true that many states have not typically been home to traditional manufacturing operations. Iowa and Nebraska are farm states, for example. But in those states, there are at least five times more government workers than farmers. West Virginia is the mining capital of the world, yet it has at least three times more government workers than miners. New York is the financial capital of the world—at least for now. That sector employs roughly 670,000 New Yorkers. That's less than half of the state's 1.48 million government employees.

    Don't expect a reversal of this trend anytime soon. Surveys of college graduates are finding that more and more of our top minds want to work for the government. Why? Because in recent years only government agencies have been hiring, and because the offer of near lifetime security is highly valued in these times of economic turbulence. When 23-year-olds aren't willing to take career risks, we have a real problem on our hands. Sadly, we could end up with a generation of Americans who want to work at the Department of Motor Vehicles.

    The employment trends described here are explained in part by hugely beneficial productivity improvements in such traditional industries as farming, manufacturing, financial services and telecommunications. These produce far more output per worker than in the past. The typical farmer, for example, is today at least three times more productive than in 1950.

    Where are the productivity gains in government? Consider a core function of state and local governments: schools. Over the period 1970-2005, school spending per pupil, adjusted for inflation, doubled, while standardized achievement test scores were flat. Over roughly that same time period, public-school employment doubled per student, according to a study by researchers at the University of Washington. That is what economists call negative productivity.
  • commoncoll

    Posts: 1222

    Apr 06, 2011 4:57 AM GMT
    I can understand that bringing back farming is not feasible. But I have heard that some manufacturing industries are coming back to the US, but they use robots in the US to replace cheap human labor.

    Perhaps soon China and India can relocate their call centers to the US. Soon you will have Steve pretending to be Ram from Delhi, instead of Ram pretending to be Steve from Miami.
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    Apr 06, 2011 5:08 AM GMT
    commoncoll saidI can understand that bringing back farming is not feasible. But I have heard that some manufacturing industries are coming back to the US, but they use robots in the US to replace cheap human labor.

    Perhaps soon China and India can relocate their call centers to the US. Soon you will have Steve pretending to be Ram from Delhi, instead of Ram pretending to be Steve from Miami.


    Why would we want to? The US does continue to manufacture more and be more productive but uses fewer people. Those jobs aren't coming back. The way to create jobs and wealth is to get out of the way of those who want to produce something. The most sustainable jobs will come from ideas and implementing them - not a race to the bottom for lower value services. The irony is that some of the fastest growing tech companies have difficulty finding people to hire while unemployment soars. There's something fundamentally wrong with the system.

    What I do know is that the way to solving the problem isn't hiring more government workers taking (or more charitably supporting) from those who are productive in society.
  • Webster666

    Posts: 9217

    Apr 06, 2011 7:16 AM GMT
    Now you're parroting the stupid Republican argument that we need to fire at least half of the people who work for the government.

    The problem isn't too many government workers as much as it's too few manufacturing jobs.

    Our Congress has allowed American companies to move their factories overseas where they can hire slave labor, with zero health care and zero safety regulations. Then, they bring their products back to the United States to sell at a huge profit.

    If you want to fix the problem, you need to give the corporations two choices: either move their factories back to America and hire American workers, or pay a huge tariff to import their foreign made goods into the United States.

    Either way, it would solve our economic crisis.

    Add to that, the fact that far too many of these corporations pay ZERO taxes.

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    Apr 06, 2011 9:40 AM GMT
    Webster666 saidNow you're parroting the stupid Republican argument that we need to fire at least half of the people who work for the government.

    The problem isn't too many government workers as much as it's too few manufacturing jobs.

    Our Congress has allowed American companies to move their factories overseas where they can hire slave labor, with zero health care and zero safety regulations. Then, they bring their products back to the United States to sell at a huge profit.

    If you want to fix the problem, you need to give the corporations two choices: either move their factories back to America and hire American workers, or pay a huge tariff to import their foreign made goods into the United States.

    Either way, it would solve our economic crisis.

    Add to that, the fact that far too many of these corporations pay ZERO taxes.



    Yup. The issue is that manufacturing jobs have been eliminated, primarily through outsourcing, not automation. The imbalance is caused by the elimination of manufacturing jobs, not the growth of government jobs.

    The dearth of manufacturing jobs are the result of policy decisions (NAFTA, GATT), and there are policy solutions.
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    Apr 06, 2011 4:19 PM GMT
    southbeach1500 said
    Webster666 said
    Add to that, the fact that far too many of these corporations pay ZERO taxes.



    So why didn't the Democrats take care of that during the past 2 years when they had COMPLETE CONTROL of Congress and the Presidency?

    Oh yeah, they were too busy "saving or creating 3 million jobs." icon_rolleyes.gif


    Actually, they were trying to prevent a financial apocalypse with no help from the Republicans. icon_cool.gif
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    Apr 06, 2011 5:32 PM GMT
    Webster666 saidNow you're parroting the stupid Republican argument that we need to fire at least half of the people who work for the government.

    The problem isn't too many government workers as much as it's too few manufacturing jobs.

    Our Congress has allowed American companies to move their factories overseas where they can hire slave labor, with zero health care and zero safety regulations. Then, they bring their products back to the United States to sell at a huge profit.

    If you want to fix the problem, you need to give the corporations two choices: either move their factories back to America and hire American workers, or pay a huge tariff to import their foreign made goods into the United States.

    Either way, it would solve our economic crisis.

    Add to that, the fact that far too many of these corporations pay ZERO taxes.



    Pardon my bluntness but you really do make yourself out to be stupid. Did it ever occur to you that people can just leave altogether? The people who own corporations that you want "trapped" into the country by making them have to keep their business in the US, otherwise suffer penalties, will simply move to some other country where the climate isn't so hostile, taking all of their spending power there.

    Best case scenario, even if many decided to stay, it would completely curb future development and growth and incentives for other people to want to move here.
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    Apr 06, 2011 5:46 PM GMT
    mocktwinkie said
    Webster666 saidNow you're parroting the stupid Republican argument that we need to fire at least half of the people who work for the government.

    The problem isn't too many government workers as much as it's too few manufacturing jobs.

    Our Congress has allowed American companies to move their factories overseas where they can hire slave labor, with zero health care and zero safety regulations. Then, they bring their products back to the United States to sell at a huge profit.

    If you want to fix the problem, you need to give the corporations two choices: either move their factories back to America and hire American workers, or pay a huge tariff to import their foreign made goods into the United States.

    Either way, it would solve our economic crisis.

    Add to that, the fact that far too many of these corporations pay ZERO taxes.



    Pardon my bluntness but you really do make yourself out to be stupid. Did it ever occur to you that people can just leave altogether? The people who own corporations that you want "trapped" into the country by making them have to keep their business in the US, otherwise suffer penalties, will simply move to some other country where the climate isn't so hostile, taking all of their spending power there.

    Best case scenario, even if many decided to stay, it would completely curb future development and growth and incentives for other people to want to move here.


    Let them leave and then we will enact tariffs against their products and services that will favor those companies that keep their production here.

    You seem to think that we're at the mercy of the wealthy and want policies that make us their supplicants. That's bullshit. There are hundreds of millions of workers and poor people in this country and only a few thousand super-rich. Once the people wake up to that - adn let's face it Ryan's budget has laid bear who the Republican Party servers - those who have benefited from pro-uber rich policies will have another think coming.
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    Apr 06, 2011 5:53 PM GMT
    So, why are US companies moving to..............Canada? icon_wink.gif
  • tongun18

    Posts: 593

    Apr 06, 2011 6:01 PM GMT
    Christian73 said
    mocktwinkie said
    Webster666 saidNow you're parroting the stupid Republican argument that we need to fire at least half of the people who work for the government.

    The problem isn't too many government workers as much as it's too few manufacturing jobs.

    Our Congress has allowed American companies to move their factories overseas where they can hire slave labor, with zero health care and zero safety regulations. Then, they bring their products back to the United States to sell at a huge profit.

    If you want to fix the problem, you need to give the corporations two choices: either move their factories back to America and hire American workers, or pay a huge tariff to import their foreign made goods into the United States.

    Either way, it would solve our economic crisis.

    Add to that, the fact that far too many of these corporations pay ZERO taxes.



    Pardon my bluntness but you really do make yourself out to be stupid. Did it ever occur to you that people can just leave altogether? The people who own corporations that you want "trapped" into the country by making them have to keep their business in the US, otherwise suffer penalties, will simply move to some other country where the climate isn't so hostile, taking all of their spending power there.

    Best case scenario, even if many decided to stay, it would completely curb future development and growth and incentives for other people to want to move here.


    Let them leave and then we will enact tariffs against their products and services that will favor those companies that keep their production here.

    You seem to think that we're at the mercy of the wealthy and want policies that make us their supplicants. That's bullshit. There are hundreds of millions of workers and poor people in this country and only a few thousand super-rich. Once the people wake up to that - adn let's face it Ryan's budget has laid bear who the Republican Party servers - those who have benefited from pro-uber rich policies will have another think coming.



    No! Tariffs will have the unintended consequence of raising the prices of the goods in question--which would disproportionately effect who?... that's right, the middle and lower classes. Plus, we should not be protecting businesses that do not have the capacity to compete! Riddler is correct in saying we should not be competing with the likes of China and India in a race to the bottom. Cede the manufacturing market to them, it's already gone from this country. What we should be doing is looking to the future, not trying to relive the past. What we should be doing is what we've always done: creating and developing new markets! Let's create and/or be the leaders in emerging markets again: nano-tech, renewable energy, etc.
  • Posted by a hidden member.
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    Apr 06, 2011 6:58 PM GMT
    Tariffs - that rings back to the dreadful days after Smoot-Hawley was enacted.

    That would be a business killer, not a business grower.

    As a compromise, tax cuts for American based businesses that hire US citizens and produce domestically should be looked at to stimulate the economy and put workers to work.
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    Apr 06, 2011 7:08 PM GMT
    alphatrigger saidTariffs - that rings back to the dreadful days after Smoot-Hawley was enacted.

    That would be a business killer, not a business grower.

    As a compromise, tax cuts for American based businesses that hire US citizens and produce domestically should be looked at to stimulate the economy and put workers to work.


    I don't even know that tax cuts are absolutely necessary. Bringing in and ensuring that the US doesn't lose innovators and entrepreneurs would be a great first step - but sadly the US government doesn't seem to be serious about bringing in entrepreneurs even when there's tangible third party investors who will back them. Recently the Obama Administration has had some interesting ideas, but the fact they would lump the startup visa into the broader can of worms that is immigration reform is disappointing:

    http://techcrunch.com/2011/03/30/startup-visa-d-o-a-and-startup-america-just-a-giant-press-release/

    But Chopra dropped a bombshell at the Economist event. He said that the President would only support the Startup Visa in the context of “comprehensive immigration reform”. What this means is that the legislation will be lumped in with toxic debates about illegal immigration and will be held hostage to other interests.

    There is reason to be concerned about the plight of the 12 million unskilled workers who are in the U.S. and lack documentation. But there is a lot of anger and other emotion in these debates. Opponents of comprehensive immigration reform say that it will provide “amnesty” to people who broke the law. Supporters argue that there are humanitarian concerns, and that we need these hard-working people to do jobs that Americans don’t want. Regardless of what is right or wrong, there is almost no chance that this contentious issue will be resolved until after the next elections—which means that the Startup Visa could be Dead on Arrival


    More on the problem here: http://www.realjock.com/gayforums/1468264
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    Apr 06, 2011 7:19 PM GMT
    Christian73 said
    mocktwinkie said
    Webster666 saidNow you're parroting the stupid Republican argument that we need to fire at least half of the people who work for the government.

    The problem isn't too many government workers as much as it's too few manufacturing jobs.

    Our Congress has allowed American companies to move their factories overseas where they can hire slave labor, with zero health care and zero safety regulations. Then, they bring their products back to the United States to sell at a huge profit.

    If you want to fix the problem, you need to give the corporations two choices: either move their factories back to America and hire American workers, or pay a huge tariff to import their foreign made goods into the United States.

    Either way, it would solve our economic crisis.

    Add to that, the fact that far too many of these corporations pay ZERO taxes.



    Pardon my bluntness but you really do make yourself out to be stupid. Did it ever occur to you that people can just leave altogether? The people who own corporations that you want "trapped" into the country by making them have to keep their business in the US, otherwise suffer penalties, will simply move to some other country where the climate isn't so hostile, taking all of their spending power there.

    Best case scenario, even if many decided to stay, it would completely curb future development and growth and incentives for other people to want to move here.


    Let them leave and then we will enact tariffs against their products and services that will favor those companies that keep their production here.

    You seem to think that we're at the mercy of the wealthy and want policies that make us their supplicants. That's bullshit. There are hundreds of millions of workers and poor people in this country and only a few thousand super-rich. Once the people wake up to that - adn let's face it Ryan's budget has laid bear who the Republican Party servers - those who have benefited from pro-uber rich policies will have another think coming.


    I'm not sure what you're meaning but I'm all for giving incentives to businesses, not punishing.
  • roadbikeRob

    Posts: 14303

    Apr 06, 2011 8:09 PM GMT
    It is not only outsourcing to China and India that has destroyed manufacturing in the US. Granted greedy corporate executives have brought down the American manufacturing sector to line their pockets, the high state taxes especially in New York have chased industry out. Greedy, unreasonable labor unions also did their fair share of damage which helped make American factories increasingly unprofitable and uncompetitive. The blame has to be distributed evenly in this troublesome situation.
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    Apr 06, 2011 8:30 PM GMT
    The trouble with Introducing a new tax in Oz, under the banner of a Carbon Tax, will only drive industry off Shaw, taking jobs with it, and forcing up unemployment, and then hand outs from the few still paying taxation.

    No something more radical needs to come to pass. Ban immigration by closing our borders, and limit breeding to two children, per......