The Jobs Imperative
By PAUL KRUGMAN
Washington’s assumption that the economic recovery will trickle down to workers is wrong and unacceptable. It’s time for an emergency jobs program.

Paul, you are right on target, as usual.

Recently, Bob Herbert of the N.Y. Times, reminded all Americans, recovery is still about the national economy. “The American people are worried sick over the economy, which may be sprouting shoots from Ben Bernanke’s lofty perspective but not from the humble standpoint of the many millions who are unemployed or those who are still working but barely able to pay their bills and hold onto their homes.” I personally remain concerned about U.S. job losses to China without regard for their replacement at home, in spite of the President's current dialogue with them. In the woods when you harvest a tree you plant another, this is not happening on the jobs front...

Americans need to read the article I cited from a recent Financial Times article concerning the “Shopping habits of China’s suddenly wealthy” (August 21,09). The “Baofahu” as they are called, have become the suddenly wealthy. “Big flashy cars like the Porsche Panamera and the Geely GE, otherwise known as the Baby Rolls-Royce, are just a couple observations concerning their tastes. Add to the list their appetites for Gold, Barbies, Sprits and the finest wines, Ivory, Dairy, Dried seahorses for aphrodisiacs, they are still labeled by the author as “penny pinching, ruthless, suspicious shoppers.” This is a must read for Americans being admonished to drive smaller cars, use less energy, be careful in wasting healthcare, and support even greater participation in global trading. This certainly dampens the welcome of futurity for Americans, especially youth.

The Financial Times also reported “Caterpillar chief hits at buy American.” “Addressing the Chicago Council on Foreign Affairs, Jim Owens attacked the ‘buy American’ position in the stimulus, saying it had prompted ‘a wave of concern throughout the world.'” The paper observed that Mr. Owens’s words carry weight in both Washington and globally…The Caterpillar chief is also a member of Mr. Obama’s Economic Advisory Board and is close to both the President and,…the transportation secretary…Mr. Owens stated that “we cannot be a great country by building a wall down the southern border." I observe that we cannot be a great country by simply protecting our bottom line and giving American jobs to other countries.

(Financial Times, Hal Weitzman) August 22, 2009, FT highlighted the story that Caterpillar holds China truck talks (Justine Lau), “The talks come just months after Caterpillar announced that it would expand its joint venture with Navistar to produce commercial vehicles outside North America…Caterpillar also said it would withdraw from being an engine supplier for U.S. truck makers because of declining sales in the U.S. market."

In fairness it should be noted that Caterpillar is not the only American company exporting jobs to China.Yet there have been some nations, however, who are to be commended for investing dollars and plants in the United States. Several auto plants are the result of Japanese, German, South Korean and other nations who understand the reciprocity inherent in equitable international trade. I am not a protectionist but businesses and nations must all yield to a fair exchange on labor and production. Our CEO's may need to read Fiedler on the subject of exchange theory.

Much has been said in recent years about “job creation.” Whether small businesses, the federal government, corporations or even the U.S. Coast Guard, estimates can range from 30,000 to over 400,000 to create a new job. Job restoration is quite a different matter and hopefully Obama's job summit efforts to return jobs to this nation will feature out of the box innovation. Why lower state and federal taxes on corporations that return jobs from overseas, or those creating jobs daily in America. Currently between Iowa's tax rate and the feds, businesses in that state must pay over 41 per cent, Singapore exempting new start ups for three years on a portion of taxes. We need these jobs back now! It should be any President's 24/7 priority, we have the highest corporate tax rates in the world.

As a nation let's provide the motivation for all to embrace a new future, not of just a shining city on a hill, but people getting paychecks, with faith in and excitement about the future.

Dr. Alan Phillips