Pelosi says that unemployment checks fastest way to create jobs

I think the govt should just write every body in america a check so we can spend it and stimulate the economy.

Better yet, lets just drop billions of dollars from helicopters. that'll stimulate the economy.

ok, ok, I've got it. I give you 100 dollars, then you give me it back. then our little "country's" gdp will be 200 dollars!!! we can continue doing this forever. what an awesome little economy we got going on. and the best part about it was we don't actually have to do anything except pass the money back and forth.

where's this money going to come from you ask? we borrowed it from the bank of course! when's it due with interest? who cares! We've got an economy that needs stimulating.

 

It is funny because it is wrong. I see it's already been said but apparently it needs repeating. Businesses are not hiring because they don't have enough customers.

 

I'd still like to see a cut in FICA, both for employer and employee.

 

Boy will that do wonders for social security and medicare deficits.

 

First: Do NOT cut taxes for businesses... this is the typical Republican response to EVERYTHING. Cutting taxes for buisnesses will not help the people that need the help and will only increase the deficit.

Second: Put pressure on labor unions.. unions are destroying this county.

 

Give unemployed people money. Keep them off the streets. They can shower, eat, and stay in decent shape until they find a new job.

I agree.

 

Actually this is true - the fundamental rationale underlying all of economic activity, when voluntarily entered into - is that transactions create value for the participants. You appear to be questioning this concept

Let me guess - you're among the collective group of geniuses who think that society can fix all of its economic problems by simply not consuming goods and services and saving its way to prosperity and not consuming good and services. Basically, the more economic activity that is terminated, the better we will be by your logic.

So if GDP were $0.00 and every business in the US declared bankruptcy as a result, we'd be Richie Rich zillionaires.

 

Cut him some slack -- he is willfully disillusioned with his idea on macroeconomics. If he truly wanted to be relevant he would stop relying on his small intellect and he would study the theories and practices of macroeconomics.

 

We will eventually have to cut the benefits off, the question is will the unemployment number go down close to pre-meltdown levels, or are we now permanently stuck at 8 or 9%?

 

Maybe, maybe not. But for us, we depleted everything we had to stay afloat (cushion, employees, pay cuts). Now that "things" are running regularly again, we're not hiring until we get back to where we once were (cushion & paycuts) and we're not betting on the future stability of the economy (no faith). Till then we're standing pat on hiring.

I don't like it because I lost 2 assist. and took a pay cut, but that is just the way it is. Now, I'm so over worked it's like the first 4 year when it was just the boss and me getting her business off the ground.

When we have the cushion to survive another setback I'll see my paycut return. After my pay normalizes for awhile we'll hire. But folks, that won't happen at least till the middle of next year.

 

Regardless of what economists say, this is idiotic. Paying people not to work increases economic output like paying farmers not to farm increases farm output. That concept was promoted by economists 50-80 years ago. It's universally discarded today.

Extending unemployment benefits may be valid on a humanitarian or moral basis. We can debate that. If you can argue that it's better for the economy, your models are wrong.

 

No - these are two totally different things. You're not paying people not to work - it's not like people voluntarily choose unemployment benefits over work. You're keeping them afloat until they find work. Paying people not to farm is a price subsidy. Paying people while unemployed is an attempt to stimulate.

This is not saying unemployed is better than employed. It's saying unemployed with benefits is better than unemployed without. Besides the stimulative effect on the economy, you also reduce the pressure on other social services, loss of housing which drops the housing market further, etc.

No serious economist agrees with you.

 

No offense, but if your hiring is dependent on anything besides demand, you're making a bad economic decision.

Adding a new employee either will more than pay for itself or not. If it would, you should hire - it will increase your net profit and let you get your paycut back. If it wouldn't, you shouldn't hire because they'd be a net drain on your business. That decision should have nothing to do with your cushion or tax cuts or anything like that.

 

The concepts aren't even remotely similar. Try again.

 

This is where someone posts a Cato or Heritage study....

 

I will be that someone to save someone else time.

http://www.heritage.org/Research/Re... The Heritage Foundation 2010 Labor Boot Camp

Fortunately, these guys don't fit into my "serious economist" categorization. The assumption is that people are choosing unemployment, as though jobs are readily available if only people weren't getting these unemployment checks.

My favorite is this part:

Roughly one-third of workers receiving UI benefits find work immediately once their benefits expire. This happens both when unemployment is high and when unemployment is low

So basically, if we would just cut off all unemployment benefits, we would immediately create millions of new jobs!

 

It's the same form of magic that teaches us that when people/govts etc stop spending and start saving, the economy magically picks up despite there being less corresponding economic activity as a direct consequence of the demand reduction.

Magic! almost as powerful as donuts!

 

I'm not advocating a permanent decrease. Let's just say a year.

Not only are you stimulating demand side, you're stimulating employment by reducing businesses' tax burden for hiring employees. Cutting checks stimulates demand, but it won't stimulate production.

 

I agree with the FICA cut. It does a couple of things - it increases disposable income, and also decreases a tax on businesses that's not profit-related. So businesses that were losing money can get to breakeven, etc.

(On a sort of related note - my earlier criticism of tax cuts for businesses was normal income tax rates. Those are unhelpful in this situation because they assume profitability).

 

Fixed it for you. But no real Scotsman believes that.