There are now approximately 14 million U. S. citizens unemployed.
Although jobs are the top priority of American citizens, the U. S. government is doing very little to create jobs.
It takes gross domestic product growth of around 3% for a full year to reduce the unemployment rate by 1%. Most economists are projecting growth rates below that level for at least the next several years.
What will become of people who are losing extended unemployment benefits? There will certainly be more home foreclosures, more people on welfare, and more tent cities of desperate people springing up for the foreseeable future.
The U. S. government spent around 700 billion to bail out the financial community. It also spent around 800 billion on a stimulus package that was promoted as being able to create thousands of good paying jobs. Yet the unemployment rate remains high at over 8.0%. Some of the jobs created were indeed good paying. Some research jobs paid as much as one hundred thousand dollars per year.
The problem is that while the unemployment rate for professionals is only around 4%, the unemployment rate for unskilled workers is over 15%. Obviously, a jobs strategy for employing unskilled and semi-skilled workers should be of a much higher priority than stimulus packages for projects that predominately employ professionals and skilled trades.
I have developed a plan that could put 4 million unskilled workers to work for a year. Businesses and state and local governments could hire people for $10.00 per hour and withhold income taxes and payroll taxes such as Social Security and Medicare as usual. Then, on a monthly basis, the gross amount paid to newly hired workers earning $10.00 or less would be submitted to state governments for reimbursement. The federal government would then reimburse the states.
The cost to the federal government of this program would be approximately 80 billion dollars, which is far less than the 700 billion bailout of the financial community. As a result, fewer people would be on welfare and would instead be paying taxes. In addition, people would have more money to buy items such as cars, food and clothing which would stimulate the economy.
With much of their labor cost paid for, businesses could be more competitive in the garment industry, farming industry and many others. State and local governments could accomplish projects and programs for less cost.
The current government strategy of providing tax breaks to corporations in hopes that the money might eventually trickle down to unemployed workers is nonsense. Corporations have been experiencing record profits for the past few years and still have resisted hiring; even though they are sitting on an estimated 2 Trillion Dollars in cash!
Some people with good jobs might wonder why we should be so concerned about the unemployed status of workers. Desperate people do desperate things! Much of the social unrest in the Middle East and northern Africa has been due to high unemployment. Do we want to risk such social unrest and potential conflict here?
On May 11, 1968, the president of the Southern Christian Leadership Conference, Rev. Ralph David Abernathy, arranged a demonstration to occur in Washington D. C. called the “Poor People’s Campaign”. Tens of thousands of people demonstrated to convince government officials to address the problems of the poor.
Perhaps a similar “We Want Jobs” campaign should be held in Washington D. C. on Labor Day.