Free Markets, Free People

Daily Archives: May 7, 2012


A new day dawns in France … well, not really

If this is any indication of how France’s new president elect, Francois Hollande, plans to govern, I pity the French as well as the rest of Europe:

The 57-year-old Socialist has openly admitted that he “does not like the rich” and declared that “my real enemy is the world of finance”. This means taxing the wealthy by up to 75 per cent, curtailing the activities of Paris as a centre for financial dealing, and ploughing millions into creating more civil service jobs.

Add an explicit threat to renegotiate the euro pact to replace austerity with “growth-creating” spending, and you have one of the most vehemently left-wing programmes in recent history.

Of course reading through that helps one understand why, after learning of his victory, President Obama immediately invited him to the White House.  Let’s see, tax the rich, go after the financial sector, grow government jobs and borrow, borrow, borrow to spend, spend, spend.

Huh … sounds familiar.

~McQ

Twitter: @McQandO


Markets at work: College and jobs (and what that may mean to Obama)

The Wall Street Journal provides an interesting infographic which fairly well outlines what the market for college graduates is looking for.  Or said another way, employers determine what majors they’ll hire, not college students.

 

collegeinfographic

 

So we have college recruiting picking up – a good sign – and we have a buyers market.  Bottom left tells us all what they’re interested in and, more importantly, what they’re not interested in.   Of course that’s of the 160 employers surveyed.  That obviously doesn’t mean that the bottom five can’t and won’t find employment.  It’s just likely they won’t find it with those 160 surveyed.  They indicated, however, a trend we’ve talked about quite often.  Hard skills or business related skills. 

Bottom right shows us how the market for college graduates has changed in the last few years.  Only 25% are hired while still in college, most, one would suppose, in those top 5 categories.  The huge difference, however, comes in the last number for 2009-2011 graduates.  45% still have no “first full-time job”.  That means some are going on 3 years.  That adds more credence to the last chart on this post

As for this year’s college grads, they face even tougher prospects when it comes to finding a job.  They not only have to compete against their peers, but against the graduates from from previous years still seeking their “first full-time job”.

Which brings us to the politics of this situation.  In 2008, Obama charmed the college age crowd who treated him like a combination of a rock-star and the second coming.

With the sort of situation the chart depicts now being the reality and with the youngest demographic (which includes these college age job seekers) the worst hit by the still staggering economy, one has to wonder whether or not he can pull them back into his orbit again in any significant numbers with the promise of saving them $7 a month on college loans. 

I’m guessing the answer is “no”.

~McQ

Twitter: @McQandO


Robert Reich’s attempt to redefine Capitalism

I’ve often said that what the left attempts to do is redefine words to blunt the impact (and fool the people) of what they’re trying to accomplish.

On the occasion of a Socialist winning France’s Presidential election, Robert Reich, of all people, is out to reassure the masses in America that Socialism is not the answer, Capitalism is.

However, upon closer reading, well it’s not the Capitalism we’d recognize.  Here are his opening paragraphs:

Francois Hollande’s victory doesn’t and shouldn’t mean a movement toward socialism in Europe or elsewhere. Socialism isn’t the answer to the basic problem haunting all rich nations.

The answer is to reform capitalism. The world’s productivity revolution is outpacing the political will of rich societies to fairly distribute its benefits. The result is widening inequality coupled with slow growth and stubbornly high unemployment.

Note the focus – ‘“fair” distribution of its benefits’.  Anyone – what about Capitalism calls for the “fair distribution of benefits.”

And if you change laws and require such a thing, can what you end up with be fairly called “Capitalism”?

Back to Reich.  He claims that workers are being replaced by “computers, software and the Internet (damn that Al Gore).  Consequently, jobs are at a premium and, well, that’s just not fair.  Besides (prepare for tired old song):

In the United States, almost all the gains from productivity growth have been going to the top 1 percent, and the percent of the working-age population with jobs is now lower than it’s been in more than thirty years (before the vast majority of women moved into paid work).

Inequality is also growing in Europe, along with chronic joblessness. Europe is finding it can no longer afford generous safety nets to catch everyone who has fallen out of the working economy.

And, apparently, the top 1% a) bury the money in cans in the back yard and b) don’t pay 37% of all income taxes collected (the top 5% pay 59%).  That’s just not sufficient anymore to keep the bottom 50%, who essentially pay no income taxes, in the lifestyle to which they’ve become accustomed.  And Reich thinks that’s wrong. However, and this is the whole point of his pitch, that’s not Socialism.Obama_Socialists_01_250px

Really?  A “fair distribution of benefits” so neatly defines Socialism, I’m not sure what’s left to say.  Except Reich wants us to somehow swallow the premise that it is also a principle part of Capitalism (it’s not) and we must reform Capitalism to conform to this newly discovered, er, inserted principle.

So what does Capitalism do?  Well, you’ve heard it said many times that the tide of Capitalism “lifts all boats”.  I.e. the “benefits” are distributed by a system that makes life better for all.  It does that by rewarding innovators, risk takers and entrepreneurs.  And those rewards can be very rich.  But:

Consumers in rich nations are reaping some of the benefits of the productivity revolution in the form of lower prices or more value for the money — consider the cost of color TVs, international phone calls, or cross-country flights compared to what they were before.

Indeed, we live better now than we did 30 years ago because of what?  The “benefits” of Capitalism as they’re traditionally defined.  Even Reich has to admit that.

However, that’s not good enough for the left.   Those not in the 1% are apparently “victims” and due much more simply because they exist.  And those who do take risks and succeed are those that owe the victims this “fairness” by giving up what they’ve earned.

You see the left’s forte is class warfare and that, frankly, is the cornerstone of Socialism.  Their traditional enemy is,  you guessed it, Capitalism and Capitalists. 

What Reich is offering is a new sort of a smoke and mirrors approach.  It’s hard to fight their traditional enemy on the basis of performance – we are a very rich nation and even our poor live better than most nation’s middle class.  So that won’t work.

Instead, it’s the politics of envy that has been employed and the siren song of “fairness” or “equality” as the required (not desired) outcome.  Oh, and that there is only one entity that can enforce either or both – government (mostly through punitive taxation).

That’s Reich’s pitch.  That’s the snake oil he’s trying to peddle.  Reassure everyone that he’s a big Capitalist (he’s not).  Pretend the problem with our system right now is it is unfair because Capitalism has gone wrong (it hasn’t).  But, with a few tweaks and reforms via government we can fix that (and end up just like Europe).

Of course we can certainly do all of that, can’t we?  And when we do, it will be called “Socialism”, won’t it?

~McQ

Twitter: @McQandO