and do not even have the bill title on what was passed.
It is usually small business can do a loss carry forward and I believe that was extended for up to 5 yrs or something previously but I'm not exactly certain what they did this time to enable this.
Now this can be a huge headache, often they are amending some other bill, so you have to dig out that bill be modified, find the clauses and then look at both and try to dissect what is changed.
While this is really grueling, esp. for those of us w/o law/public policy/legislative backgrounds, frankly when you get into these lobbyist agenda bills, they have this stuff down to an art.
So, you're looking at two huge documents, where something says "amend section IV, a(part j)" and add "not".
You have to figure out what that really does!
But that's the art of loophole, often loopholes are not even discovered until way after a bill is passed.
Even worse, they have "conferees" who "rectify" the "differences between House and Senate versions of the bill"
and literally they have changed entire amendments.
ex. they ripped out Bernie Sander's amendments even though it passed both houses by wide margins.
and then we have "bill manager amendments", which are sometimes a complete rewrite of the bill, they present these at the last minute, not a single person has read it and it's passed by voice vote.
It's no wonder nothing gets passed that isn't written by corporate lobbyists under these circumstances...
but there ya have it. So, in this case, we need the bill title so we can dig out the legislative text. I'm assuming NYT verified but they don't say if it's to all big business or not in the article.
thomas.gov is a skill unto itself. You also have to get a permanent link. Most things showing up in the search are temporary and expire in a matter of 10 minutes. What fun, yeah, this is public discourse.
but according to article the original intent was for small businesses then, with what was probably heavy lobbying, was opened to every business but analysis shows that home builders will benefit tremendously from tax break and they lobbied hard for it.
So it seems there is some momentum going on here where we're all saying we need some sort of "WPA" style direct jobs program....
which leads me back to my original concerns of administration, management details.
We've been calling for direct jobs, I believe, almost from day 1 of this site's existence, so posts detailing proposals and plans are especially welcome!
We're an economics blog, so your complaint just is public for all who visit the site to read.
But...we believe you! We're heard many reports that the Hope program is this type of run around misinformation. It seems Banks can make more money in fees by foreclosing.
All I can say is consider posting far and wide, call your Congress rep. and to join forces with others who are receiving this treatment.
i.e. one could do both. Have distribution of funds through local governments but also give some sort of management structure that is effective for them to implement. So, one could do both, have some funds distributed locally for needed projects. (How many localities for example need a new water system or a new power station or need say city wide broadband access, etc.?) but the large money should focus on those projects, public works with the largest "payout" for the future of America.
But in all of these discussions, the real problem I see is the management, administration of it all. I don't want to feed more administration officials, absurd "retraining", more no-bid contractors. I want the funds to go directly to workers, efficient, effective public works programs that "pay out" to the community way beyond just employing some residents. Work also has to be important frankly for people to feel good, that they are contributing, accomplishing and there are so many things, all over the country that are in the public sphere, neglected.....
so I think it wouldn't be so hard to find "most bang for the buck" projects.
but the loss carry forward, or backward, doesn't this apply to all business, i.e. GS, GE, GM?
Or did they limit it to just these home builders?
I like how the New York Times is finally showing disgust passed by out of Congress these days that isn't reviewed and approved by corporate lobbyists.
Think a constituent could walk in with even a perfect piece of written legislation and get anything beyond lip service? No way. An Economist? Nope. But oh yeah...
Frankly Congress has outsourced their legislation writing to lobbyists. (they are also told how to vote too).
The Federal Government corruption is bad enough, but I really think funds would disappear and projects would be good ole boy favors if it was decentralized yet distributed through state and local governments.
We're already seen no-bid contracts popping up through the Stimulus distributions to states.
That said, the entire "trade readjustment" and "retraining" mantra you will hear from those to blow off the supposedly claim that free trade "can cause economic hardship temporarily to localities" (read the entire nation is a locality, and the time period isn't temporary) is a joke.
I saw a community college get almost a million dollar to "retrain" people with Masters degrees to be....restaurant workers. I kid you not.
So, a program that gives jobs, into the public works but also gives real training in real skills I think would be a good idea.
The problem is how money is distributed from Federal Funds and the entire management structure of such a program. Not only do you need to watchdog it....we have billions and billions wasted every year through no-bid contracts, defense projects that are not warranted, political lobbying by special interest groups, corruption and administrators who think they must have 6 figure salaries and bonuses and we get layer upon layer of unneeded "administration". Case in point is universities. There was a recent report where they have massive administration bloat while professor salaries are below market wage for their field, adjunct professors, non-tenured are getting paid below minimum wage, graduate student stipends are way below minimum wage, you plain can't live on it and tuition is through the roof.
All of that needs to be stopped for any program to be effective.
All of that executive/administration 6 figure pay and bloat needs to be stopped. It's happening in K-12, in private companies and in state government.
I also think they need to target public works projects which will have the biggest "payout" to the nation and that means people will have to move to where the job is in part.
For example, let's say there is an initiative to rebuild the power grid and add high power lines to new alternative energy regions. i.e. Wind farms in the Texas wind corridor and solar in the SW. Workers would have to go to those localities to work on it.
In other words, just a project needs to be run like a for profit company and thus get the most "taxpayer bang for the buck".
is proposing a Job Guarantee Program. This may address the serious high structural unemployment problem that we are going to encounter.
The original New Deal programs included large–scale infrastructure projects with direction coming from Washington. A permanent and universal JG program should be decentralized, with projects created and administered locally–where the workers are, and for the benefit of their communities. The federal government would provide the wages, plus a portion of capital and supervisory expenses (perhaps capped at 25% of total wages paid for each JG project). Local governments and nonprofits would propose projects and cover the rest of the expenses. State unemployment offices would be converted to employment offices, helping to match workers and projects.
Project proposals would be submitted to regional councils and, if approved, would be evaluated by state councils and then by a federal council. Wages and benefits would be paid directly to workers (using Social Security numbers and direct bank deposits) to minimize fraud. Organizations submitting proposals would be prevented from replacing paid workers with JG workers. For-profit business would be excluded, because the temptation to substitute would be too great. At the same time, businesses would be protected from unfair competition because all JG projects would have to demonstrate they’d fulfill unmet public purposes. If at some future date, a for-profit firm decided to provide services that a JG project is performing, the JG project could be phased out. There is neither need nor desire for the JG program to compete with the private for-profit sector.
As stated above this program is a total failure. I would like to know when Bank Of America accepted the billions from the government where did the money go..definitely not helping the consumer.
I was asking to lower my rate to the current 4.25% that is being offered. I was on the phone with a rep from BOA who told me not to pay my mortgage, until I heard from someone at the company. I did not pay for 2 months & received a foreclosure notice from BOA. I was pretty pissed, so I called them & was treated very poorly like I was a bum. I tried to explain that the rep told me not to pay & she said that it was his advice, but should not have been said. I had asked to talk to the person handling my claim & was told that you could not speak to him. I would be contacted if more information was needed..if not by mail.
I received a form letter that is probably being sent out to thousands of people rejecting them w/ no reason or information. This is a travesty and just another Obama move that was temporarily satisfying, but implementation & oversight does not exist.
I would still like to know where the billions went????
I want to see some major direct works program and additionally significant investment in the U.S. and her people, I'm just thinking out loud about what can work and pass for the most effective ways possible.
So, I for one am thrilled at this post and starting to raise the dialog and present possibilities.
I think some "cleaning house" of no bid contracts and contracts generally is also in order.
in this American age where labor and work is just completely dismissed, it's a great reminder that people back then died for the cause. Can you imagine anyone laying down their lives for labor rights at this moment?
CCC workers were paid $30/month, with $25 going directly to their families. About the only way I can see them getting away with that today is to say it's a "work-study" type of program and later, after completion, offer a free ride to a public college/trade schools with job placement.
I've read the WPA was not efficient in terms of requiring people to actually do the jobs. Not in every division, but some.
I think your calculations are way off on the jobs cost.
It should be, very roughly, 2.5x wages. Paying each $15/hr would be equivalent to about $78 Billion for a million workers and that's not including infrastructure, equipment, housing, capital and so forth to do a direct jobs program.
So, to me, if one wants to push a direct jobs program, one must use existing administration, infrastructure, the minimal additional expenditures as possible, consider doing some sort of housing/free medical/dental/child care type of deal (which an you imagine the rhetoric on this one!) and most importantly, target public works projects that are going to have huge payouts economically for the nation.
So, this also implies hiring the destitute and the desperate..OR....well, paying them market wage and not that great in other offerings. hmmm....
I see screams from the left on wages, screams from the right about how the "communists are locking up Americans into central planning slave labor camps" just blasting to shit from both sides! Can you hear it now? I can.
Even if one called it "retraining", OMG, the political rhetoric will be insane.
If only one could get to practicality vs. this insane, off the mark, diversionary screams from the left/right.
So, I gotta say what's the "Profit margin" for public works? I know that's an oxymoron, but I'd frame it in those terms.
Say, running high power lines from wind corridors for wind farms, or say particular bridges, if they fell down would not only be a horrific loss of life but also cripple a regional economy, i.e. the projects need to be selected that they will even potentially generate revenues for the future for the U.S. government to make the long term payout a zero sum game at least. i.e. the government is going to "get the money back" from a "long term jobs program".
Now, that's a most interesting thing because to me, the U.S. has been riding the coat tails of the New Deal infrastructure projects for 60 years and the highway infrastructure projects...
so can one show that the U.S. government and national economy "made money" by all of that infrastructure put into place 60, 40 years ago?
How does one quantify the WPA artists program which has left us with so many interesting things to look at, added to the public sphere, the "beauty" of a place?
But I think that initial sticker shock might also be muted by $700 Billion for Wall Street bonuses rhetoric and I hate to say it but $787 Billion (or whatever it was) for Stimulus that didn't really create jobs...
therefore one can put together $300 Billion with the final "profit margin" will be $1 trillion in 5 years projected...
something along those lines.
Fed contracts, I grant you, that's fairly easy. Just don't know how much that would generate in a year.
Here's my calculation:
$24k a year in wages.
Add 12% for Social Security. That's $26.8k a year.
Add 30% for all non-labor costs (admin, land, materials, tools, etc.). This is a conservative estimate; the WPA managed a 20% non-labor cost. That's $34.8k per job created, or about $35 billion for every million jobs.
Tell me if I'm doing the math wrong here.
CCC - it was somewhat efficient (don't over-romanticize the military admin here, or the getting back to nature), but that has a lot to do with the wages. CCC workers were only paid $20 a month ($329 in 2008 dollars). It's easy to be efficient if you pay people mostly in room and board.
The WPA was actually remarkably efficient, with $50 a month in wages and $10 a month in non-wage costs.
because they don't use conditions to get them, so they are usually manipulated. Take IBM. They get state tax credits constantly to create jobs...they never do and they never get those tax credits revoked. Instead they offshore outsource the jobs.
On revoking Federal and State contracts that are currently offshore outsourced I beg to differ. Those would be immediate jobs for very little costs. Right now states offshore outsource call centers for social services, as well as a lot of back end work. All of that can easily be re-transferred back to the U.S. It's already government expenditures anyway, which makes zero sense to not put all U.S. taxpayer dollars back into the domestic economy for job creation, esp. services for the unemployed and poor. But bottom line is the infrastructure is still here to do those jobs and it's just a matter of transferring it back. They transferred it out in a matter of months so this would be faster than any direct jobs program and much cheaper.
Secondly. I don't know where you are getting those calculations but a 3500:1 dollar ratio for a job is what I am referring to. That is beyond inefficient. In the private sector, the ratio is about 2.5:1 for a cost of an employee vs. their wages. So, where in God's name is this 3500 going to? You could take that money, create 10,000 startups in the U.S., will strong stipulations they must employ U.S. workers and not below X wage or say at least meet the occupational median, generate a host of new ventures, a host of innovations and have it be way cheaper.
and this is from someone who blasts the no-bid "Iraq" contract award system, which apparently is one of the ultimate feeding at the government trough with little bang for the buck.
Believe me, I'm not for giving away U.S. tax dollars to MNCs, believe most tax cuts are manipulated and believe we need a direct jobs program....but 3500:1, there would be no way if I was in Congress I would approve of that because it's way too expensive per job.
I think they should deploy the military in some capacity to run a new CCC type of program, but not only for youth, but also for older workers. We have institutionalized age discrimination and I think older workers could be the ones training these kids, providing management skills....but the CCC was pretty damn efficient during it's day (not so much the WPA) and they also demanded high productivity and that's obviously true if one visits any of the state parks, forests and so forth they created.
The first 4 things you discuss probably won't be in, since they're long-term rather than short-term.
Infrastructure is good, it's just that as we've seen it takes quite some time to get going.
Regarding the efficiency question - yes, direct job creation is more expensive than a tax credit. But it's more effective. You create jobs directly - you get the number of jobs you planned for, plus some more from the multiplier effect of their wages.
But as you can see from the historical evidence on the New Jobs Tax Credit - dollar for dollar it worked out great, but it only created about a half-million jobs. In order to really make a difference, you need something "bigger bore," and that costs money.
However, there is something I didn't discuss, which is the return on the investment. The jobs programs I discuss, like the historical WPA, largely involve unskilled workers using basic hand tools and techniques to do "light construction," and unskilled workers providing public services. However, you still create "infrastructure," as you would in the proposed infrastructure, because even a less efficient mass of workers still generates a lot of work, and that labor power which would otherwise be lost to time is then gained.
Just doing a rough calculation: the average American worker produces $105k per year. Even if we assume a very low productivity of these jobs program workers, you only need to hit $35k per worker (or 1/3 as efficient as the average worker) to break even in terms of money spent versus production created. I don't think it's out of the realm of possibility that we'd be looking at a least $52.5k per worker (or 1/2 as efficient), which would result in a net addition of $17.5k per worker. For a million workers, that means by spending $35 billion, you create an additional $17.5 billion over your $35 billion investment - or .125% GDP (and that doesn't count the multiplier effect of the wages, etc.).
Like cancel the offshore outsourcing of Federal and State contracts. Get China to float the yuan. Create a federal venture capital fund, using loans from the Federal Government, with companies stipulation they must be incorporated in the U.S. and must hire U.S. workers.
How about targeting advanced manufacturing and subsidize it here in the U.S.?
How about trade reform?
How about corporate tax code reform. They could pass a fairly simple bill to repeal the tax deferrals which make incentives for offshore outsourcing. This was a campaign promise.
What about infrastructure jobs? Firstly some of the money you're talking about, per job creation doesn't sound very efficient but more importantly, one can create jobs which do something, i.e. give back, money that the Federal government would have to pay anyway, such as infrastructure. They also need older workers who could be used as a dual purpose, not only would that give them work, but also allow them to train the untrained. They have the skills and there are advanced skills that, again, due to offshore outsourcing are plain being lost because there is no job where that person can apply their craft. The #1 area I'm thinking of here is tool & die makers, but there are many others.
Frankly I think a jobs bill needs a few things. Firstly they must verify that the job is here in the United States and it is going to a U.S. citizen/perm resident. Then, they need to look at this as one would any business. Where is the most bang for the buck in terms of products, i.e. which bridge is about to collapse if they do not get funds. I know people would like that money to be distributed regionally, but I think that's a mistake and instead they should go to projects and then offer temporary housing and travel so people in seriously depressed regions can go work at these jobs. Probably day care as well.
But my main point is that $35 billion per $1 million jobs is way, way too high. That's a 3500:1 ratio! So is the $22 Billion per 1 million. No way! That has to be inefficient as hell.
Previously I've been in the "L" camp, but now my "L" looks like this:
|__
In other words, because we have a government run by multinational corporations, we are not getting the legislation and policy to restructure....so it's the continuing slide that has been going on for some time but I'm thinking all of these events will compound the long term slide to cause it to have a higher downward slope.
I'll bet $5 bucks that this "jobs summit" will be more B.S. and not the structural changes needed.
much better than we are. Their approach to regulatory reform, while still being worked out, is starting off much more aggressive than we are.
RebelCapitalist.com - Financial Information for the Rest of Us.
the breaks usually happen by putting language in "amending Title X, Sect. 3 to say _______" and it's usually at the end of the legislation.
RebelCapitalist.com - Financial Information for the Rest of Us.
and do not even have the bill title on what was passed.
It is usually small business can do a loss carry forward and I believe that was extended for up to 5 yrs or something previously but I'm not exactly certain what they did this time to enable this.
Where I browse legislation is thomas.gov.
Now this can be a huge headache, often they are amending some other bill, so you have to dig out that bill be modified, find the clauses and then look at both and try to dissect what is changed.
While this is really grueling, esp. for those of us w/o law/public policy/legislative backgrounds, frankly when you get into these lobbyist agenda bills, they have this stuff down to an art.
So, you're looking at two huge documents, where something says "amend section IV, a(part j)" and add "not".
You have to figure out what that really does!
But that's the art of loophole, often loopholes are not even discovered until way after a bill is passed.
Even worse, they have "conferees" who "rectify" the "differences between House and Senate versions of the bill"
and literally they have changed entire amendments.
ex. they ripped out Bernie Sander's amendments even though it passed both houses by wide margins.
and then we have "bill manager amendments", which are sometimes a complete rewrite of the bill, they present these at the last minute, not a single person has read it and it's passed by voice vote.
It's no wonder nothing gets passed that isn't written by corporate lobbyists under these circumstances...
but there ya have it. So, in this case, we need the bill title so we can dig out the legislative text. I'm assuming NYT verified but they don't say if it's to all big business or not in the article.
thomas.gov is a skill unto itself. You also have to get a permanent link. Most things showing up in the search are temporary and expire in a matter of 10 minutes. What fun, yeah, this is public discourse.
but according to article the original intent was for small businesses then, with what was probably heavy lobbying, was opened to every business but analysis shows that home builders will benefit tremendously from tax break and they lobbied hard for it.
RebelCapitalist.com - Financial Information for the Rest of Us.
Calculated Risk has put together a collection of Krugman writings on this.
The below youtube, the audio is poor.
So it seems there is some momentum going on here where we're all saying we need some sort of "WPA" style direct jobs program....
which leads me back to my original concerns of administration, management details.
We've been calling for direct jobs, I believe, almost from day 1 of this site's existence, so posts detailing proposals and plans are especially welcome!
We're an economics blog, so your complaint just is public for all who visit the site to read.
But...we believe you! We're heard many reports that the Hope program is this type of run around misinformation. It seems Banks can make more money in fees by foreclosing.
All I can say is consider posting far and wide, call your Congress rep. and to join forces with others who are receiving this treatment.
i.e. one could do both. Have distribution of funds through local governments but also give some sort of management structure that is effective for them to implement. So, one could do both, have some funds distributed locally for needed projects. (How many localities for example need a new water system or a new power station or need say city wide broadband access, etc.?) but the large money should focus on those projects, public works with the largest "payout" for the future of America.
But in all of these discussions, the real problem I see is the management, administration of it all. I don't want to feed more administration officials, absurd "retraining", more no-bid contractors. I want the funds to go directly to workers, efficient, effective public works programs that "pay out" to the community way beyond just employing some residents. Work also has to be important frankly for people to feel good, that they are contributing, accomplishing and there are so many things, all over the country that are in the public sphere, neglected.....
so I think it wouldn't be so hard to find "most bang for the buck" projects.
but the loss carry forward, or backward, doesn't this apply to all business, i.e. GS, GE, GM?
Or did they limit it to just these home builders?
I like how the New York Times is finally showing disgust passed by out of Congress these days that isn't reviewed and approved by corporate lobbyists.
Think a constituent could walk in with even a perfect piece of written legislation and get anything beyond lip service? No way. An Economist? Nope. But oh yeah...
Frankly Congress has outsourced their legislation writing to lobbyists. (they are also told how to vote too).
The Federal Government corruption is bad enough, but I really think funds would disappear and projects would be good ole boy favors if it was decentralized yet distributed through state and local governments.
We're already seen no-bid contracts popping up through the Stimulus distributions to states.
That said, the entire "trade readjustment" and "retraining" mantra you will hear from those to blow off the supposedly claim that free trade "can cause economic hardship temporarily to localities" (read the entire nation is a locality, and the time period isn't temporary) is a joke.
I saw a community college get almost a million dollar to "retrain" people with Masters degrees to be....restaurant workers. I kid you not.
So, a program that gives jobs, into the public works but also gives real training in real skills I think would be a good idea.
The problem is how money is distributed from Federal Funds and the entire management structure of such a program. Not only do you need to watchdog it....we have billions and billions wasted every year through no-bid contracts, defense projects that are not warranted, political lobbying by special interest groups, corruption and administrators who think they must have 6 figure salaries and bonuses and we get layer upon layer of unneeded "administration". Case in point is universities. There was a recent report where they have massive administration bloat while professor salaries are below market wage for their field, adjunct professors, non-tenured are getting paid below minimum wage, graduate student stipends are way below minimum wage, you plain can't live on it and tuition is through the roof.
All of that needs to be stopped for any program to be effective.
All of that executive/administration 6 figure pay and bloat needs to be stopped. It's happening in K-12, in private companies and in state government.
I also think they need to target public works projects which will have the biggest "payout" to the nation and that means people will have to move to where the job is in part.
For example, let's say there is an initiative to rebuild the power grid and add high power lines to new alternative energy regions. i.e. Wind farms in the Texas wind corridor and solar in the SW. Workers would have to go to those localities to work on it.
In other words, just a project needs to be run like a for profit company and thus get the most "taxpayer bang for the buck".
is proposing a Job Guarantee Program. This may address the serious high structural unemployment problem that we are going to encounter.
RebelCapitalist.com - Financial Information for the Rest of Us.
As stated above this program is a total failure. I would like to know when Bank Of America accepted the billions from the government where did the money go..definitely not helping the consumer.
I was asking to lower my rate to the current 4.25% that is being offered. I was on the phone with a rep from BOA who told me not to pay my mortgage, until I heard from someone at the company. I did not pay for 2 months & received a foreclosure notice from BOA. I was pretty pissed, so I called them & was treated very poorly like I was a bum. I tried to explain that the rep told me not to pay & she said that it was his advice, but should not have been said. I had asked to talk to the person handling my claim & was told that you could not speak to him. I would be contacted if more information was needed..if not by mail.
I received a form letter that is probably being sent out to thousands of people rejecting them w/ no reason or information. This is a travesty and just another Obama move that was temporarily satisfying, but implementation & oversight does not exist.
I would still like to know where the billions went????
I want to see some major direct works program and additionally significant investment in the U.S. and her people, I'm just thinking out loud about what can work and pass for the most effective ways possible.
So, I for one am thrilled at this post and starting to raise the dialog and present possibilities.
I think some "cleaning house" of no bid contracts and contracts generally is also in order.
in this American age where labor and work is just completely dismissed, it's a great reminder that people back then died for the cause. Can you imagine anyone laying down their lives for labor rights at this moment?
CCC workers were paid $30/month, with $25 going directly to their families. About the only way I can see them getting away with that today is to say it's a "work-study" type of program and later, after completion, offer a free ride to a public college/trade schools with job placement.
I've read the WPA was not efficient in terms of requiring people to actually do the jobs. Not in every division, but some.
I think your calculations are way off on the jobs cost.
It should be, very roughly, 2.5x wages. Paying each $15/hr would be equivalent to about $78 Billion for a million workers and that's not including infrastructure, equipment, housing, capital and so forth to do a direct jobs program.
So, to me, if one wants to push a direct jobs program, one must use existing administration, infrastructure, the minimal additional expenditures as possible, consider doing some sort of housing/free medical/dental/child care type of deal (which an you imagine the rhetoric on this one!) and most importantly, target public works projects that are going to have huge payouts economically for the nation.
So, this also implies hiring the destitute and the desperate..OR....well, paying them market wage and not that great in other offerings. hmmm....
I see screams from the left on wages, screams from the right about how the "communists are locking up Americans into central planning slave labor camps" just blasting to shit from both sides! Can you hear it now? I can.
Even if one called it "retraining", OMG, the political rhetoric will be insane.
If only one could get to practicality vs. this insane, off the mark, diversionary screams from the left/right.
So, I gotta say what's the "Profit margin" for public works? I know that's an oxymoron, but I'd frame it in those terms.
Say, running high power lines from wind corridors for wind farms, or say particular bridges, if they fell down would not only be a horrific loss of life but also cripple a regional economy, i.e. the projects need to be selected that they will even potentially generate revenues for the future for the U.S. government to make the long term payout a zero sum game at least. i.e. the government is going to "get the money back" from a "long term jobs program".
Now, that's a most interesting thing because to me, the U.S. has been riding the coat tails of the New Deal infrastructure projects for 60 years and the highway infrastructure projects...
so can one show that the U.S. government and national economy "made money" by all of that infrastructure put into place 60, 40 years ago?
How does one quantify the WPA artists program which has left us with so many interesting things to look at, added to the public sphere, the "beauty" of a place?
But I think that initial sticker shock might also be muted by $700 Billion for Wall Street bonuses rhetoric and I hate to say it but $787 Billion (or whatever it was) for Stimulus that didn't really create jobs...
therefore one can put together $300 Billion with the final "profit margin" will be $1 trillion in 5 years projected...
something along those lines.
Fed contracts, I grant you, that's fairly easy. Just don't know how much that would generate in a year.
Here's my calculation:
$24k a year in wages.
Add 12% for Social Security. That's $26.8k a year.
Add 30% for all non-labor costs (admin, land, materials, tools, etc.). This is a conservative estimate; the WPA managed a 20% non-labor cost. That's $34.8k per job created, or about $35 billion for every million jobs.
Tell me if I'm doing the math wrong here.
CCC - it was somewhat efficient (don't over-romanticize the military admin here, or the getting back to nature), but that has a lot to do with the wages. CCC workers were only paid $20 a month ($329 in 2008 dollars). It's easy to be efficient if you pay people mostly in room and board.
The WPA was actually remarkably efficient, with $50 a month in wages and $10 a month in non-wage costs.
because they don't use conditions to get them, so they are usually manipulated. Take IBM. They get state tax credits constantly to create jobs...they never do and they never get those tax credits revoked. Instead they offshore outsource the jobs.
On revoking Federal and State contracts that are currently offshore outsourced I beg to differ. Those would be immediate jobs for very little costs. Right now states offshore outsource call centers for social services, as well as a lot of back end work. All of that can easily be re-transferred back to the U.S. It's already government expenditures anyway, which makes zero sense to not put all U.S. taxpayer dollars back into the domestic economy for job creation, esp. services for the unemployed and poor. But bottom line is the infrastructure is still here to do those jobs and it's just a matter of transferring it back. They transferred it out in a matter of months so this would be faster than any direct jobs program and much cheaper.
Secondly. I don't know where you are getting those calculations but a 3500:1 dollar ratio for a job is what I am referring to. That is beyond inefficient. In the private sector, the ratio is about 2.5:1 for a cost of an employee vs. their wages. So, where in God's name is this 3500 going to? You could take that money, create 10,000 startups in the U.S., will strong stipulations they must employ U.S. workers and not below X wage or say at least meet the occupational median, generate a host of new ventures, a host of innovations and have it be way cheaper.
and this is from someone who blasts the no-bid "Iraq" contract award system, which apparently is one of the ultimate feeding at the government trough with little bang for the buck.
Believe me, I'm not for giving away U.S. tax dollars to MNCs, believe most tax cuts are manipulated and believe we need a direct jobs program....but 3500:1, there would be no way if I was in Congress I would approve of that because it's way too expensive per job.
I think they should deploy the military in some capacity to run a new CCC type of program, but not only for youth, but also for older workers. We have institutionalized age discrimination and I think older workers could be the ones training these kids, providing management skills....but the CCC was pretty damn efficient during it's day (not so much the WPA) and they also demanded high productivity and that's obviously true if one visits any of the state parks, forests and so forth they created.
The first 4 things you discuss probably won't be in, since they're long-term rather than short-term.
Infrastructure is good, it's just that as we've seen it takes quite some time to get going.
Regarding the efficiency question - yes, direct job creation is more expensive than a tax credit. But it's more effective. You create jobs directly - you get the number of jobs you planned for, plus some more from the multiplier effect of their wages.
But as you can see from the historical evidence on the New Jobs Tax Credit - dollar for dollar it worked out great, but it only created about a half-million jobs. In order to really make a difference, you need something "bigger bore," and that costs money.
However, there is something I didn't discuss, which is the return on the investment. The jobs programs I discuss, like the historical WPA, largely involve unskilled workers using basic hand tools and techniques to do "light construction," and unskilled workers providing public services. However, you still create "infrastructure," as you would in the proposed infrastructure, because even a less efficient mass of workers still generates a lot of work, and that labor power which would otherwise be lost to time is then gained.
Just doing a rough calculation: the average American worker produces $105k per year. Even if we assume a very low productivity of these jobs program workers, you only need to hit $35k per worker (or 1/3 as efficient as the average worker) to break even in terms of money spent versus production created. I don't think it's out of the realm of possibility that we'd be looking at a least $52.5k per worker (or 1/2 as efficient), which would result in a net addition of $17.5k per worker. For a million workers, that means by spending $35 billion, you create an additional $17.5 billion over your $35 billion investment - or .125% GDP (and that doesn't count the multiplier effect of the wages, etc.).
Like cancel the offshore outsourcing of Federal and State contracts. Get China to float the yuan. Create a federal venture capital fund, using loans from the Federal Government, with companies stipulation they must be incorporated in the U.S. and must hire U.S. workers.
How about targeting advanced manufacturing and subsidize it here in the U.S.?
How about trade reform?
How about corporate tax code reform. They could pass a fairly simple bill to repeal the tax deferrals which make incentives for offshore outsourcing. This was a campaign promise.
What about infrastructure jobs? Firstly some of the money you're talking about, per job creation doesn't sound very efficient but more importantly, one can create jobs which do something, i.e. give back, money that the Federal government would have to pay anyway, such as infrastructure. They also need older workers who could be used as a dual purpose, not only would that give them work, but also allow them to train the untrained. They have the skills and there are advanced skills that, again, due to offshore outsourcing are plain being lost because there is no job where that person can apply their craft. The #1 area I'm thinking of here is tool & die makers, but there are many others.
Frankly I think a jobs bill needs a few things. Firstly they must verify that the job is here in the United States and it is going to a U.S. citizen/perm resident. Then, they need to look at this as one would any business. Where is the most bang for the buck in terms of products, i.e. which bridge is about to collapse if they do not get funds. I know people would like that money to be distributed regionally, but I think that's a mistake and instead they should go to projects and then offer temporary housing and travel so people in seriously depressed regions can go work at these jobs. Probably day care as well.
But my main point is that $35 billion per $1 million jobs is way, way too high. That's a 3500:1 ratio! So is the $22 Billion per 1 million. No way! That has to be inefficient as hell.
We don't know what's in the discussed bill yet - I've started making some inquiries, but I haven't found anything solid yet.
Previously I've been in the "L" camp, but now my "L" looks like this:
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In other words, because we have a government run by multinational corporations, we are not getting the legislation and policy to restructure....so it's the continuing slide that has been going on for some time but I'm thinking all of these events will compound the long term slide to cause it to have a higher downward slope.
I'll bet $5 bucks that this "jobs summit" will be more B.S. and not the structural changes needed.
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