Unemployment solution?

Heya ATSers,

I was contemplating the U-6 numbers and the breakdown of the real number in the US as to either unemployed or underemployed. the number is approximately 26.6% (this number might be slightly inflated...but lets say easily 1 in every 4 people are unemployeed or working some crappy part time job). thats a big number...1/4th of our workforce is struggling.

I made a thread sometime back about what the government could do in order to quickly help solve this problem..many good ideas, lots of standard partisan ideas, meh...take the good with the bad. Anyhow, a concept did finally arise from the ashes that seems to be almost bulletproof. Take a moment to consider it before replying though..will give some points to ponder.

Workweek in the US is currently 40 hours before you pay overtime...therefore the monday-friday 8 hour workweek is in place.
We have 25% of people wanting to work (or work more)
Why not cut the full time requirements of 40 hours to 30 hours before overtime kicks in?

This would force companys, based on cost ratio, to stock up on an extra 25% workforce to maintain the same hours of operation and productivity.

this would of course lessen disposable income for people by 1/4th, of their current earnings, which would kick in deflation and make the dollar stronger. Companies wishing to compete in the market correction would potentially have to work longer and produce more to come down in cost, increasing the 8 hour day to a 10 hour day (two shifts), creating potentially double the job opportunities..

I am sure I am simply seeing the good side of this, what possible negative ramifications could come from our model change?

[edit on 11-2-2010 by SaturnFX]

The reason for not doing this is because
1. they would have to change the part time hour requirements as well, and that would have a big impact on Health Benefits, most companies are now starting to offer benefits for part time workers,

2nd. by cutting it to 30 hours for full time, people still need the money they get from 40 hours a week, so companies would either have to give a raise to comensate, or pay overtime for each employee for 10 hours a week, which would raise the companies expenses, while they may not see an increase in profit, they would also have to hire more workers which would also be a bigger expense,

3. i for one love my 8-5 40 hours a week Monday through Friday job and dont want to change that, im used to it, and i like it, a lot of people wouldn't like the change as well, i know i don't.

anyways thats my opinion

reply to post by l neXus l


1) Part time simply means less than full time(actually, my state views anything under 35 hours as part time). So, if there was a full time = 30 hours a week, then 29 hours would technically be considered part time, unless they also gave a 5 hour buffer, then it would be 25 hours or less

2) Companies would not give raises nor allow overtime...they would hire more people at normal costs. Thats sort of the whole point. If the average income drops 25% across the board, then that would also reflect on prices, homes, etc etc...your money would have to go further than it does now, but it default would go further due to deflation

3) your used to the hours is not a overly strong arguement when the nation is in peril of having a epic collapse. Get used to less hours, or pick up a second job to fill in the time.

i wasnt really arguing just stating what i have experienced when my last job went from 40 hrs full time to being 30 hours and it messed up our whole process, i looked for a new job because of it

Funny how we're still tied to a system that was developed nearly a century ago to address the conditions extant in a pre-digital world. Every indicator I know suggest that the work week should be around 28 hours if people are to have the time and energy required to navigate modern life successfully.

Of course you'd need to pay a living wage at that hourly rate. Where would the money come from?

Easy: cap wealth at one billion dollars, mandatory economic retirement at that point. Once you control the wealth-addicted, and inform them that their feelings of self-worth need to come from some other source, there's plenty of money to pay other people properly.

Yea, tell people who are working 40 hours a week and still struggling that they will now work 30 hours a week and not recieve a raise to compensate.

Your idea behind it is somewhat correct, but you are assuming that such changes will be immediate and people will not be hurt financially from the lost of hours. In reality it will probably take about 6 months (probably twice that) for the economy to catch up to the shift of income being brought in.

A lot more families will suffer, credit be destroyed, homes lost and all that will do is extend the shape of our economy.

reply to post by SaturnFX


I like the fact you are thinking outside of the box and realize that collectively if we want long term security in jobs we must adopt a new way of doing business. I, like you, have thought of a number of ways to stop the current economic depression. The biggest most simple fix I can see is place suspend payroll taxes employees. This requires government though to slash spending equally. A far fetch for them to do this. What would occur is people would begin having disposable income and feed that into companies, creating tax revenue on every transaction and allowing companies to sell their products. In turn, companies might have to hire more workers. If you want to take health care to the next level simply cut payroll taxes proportionately to the employers contribution to an employees health care coverage costs.

How fast would an average persons income start adding up with $50-$150 in money on their paycheck every week? I agree that something needs to be done. Making politicians let go of all their pet projects and spending programs is the first step. I do not support limiting the income of individuals wherein our government is expanding their own spending.

I have an idea that has already been fielded by Obama and Emanuel.

What about a huge volunteered group that would rival the US military?

That would be a great idea!

I am sure the plans are already drawn up!

As for the OP, you are going to institute more REGS on business? Excellent idea, we all know government regulation has helped us over the last 40 years!

Originally posted by apacheman
Easy: cap wealth at one billion dollars, mandatory economic retirement at that point. Once you control the wealth-addicted, and inform them that their feelings of self-worth need to come from some other source, there's plenty of money to pay other people properly.

I actually dont like the cap wealth concept for a few reasons. First off, it reeks of social engineering..some socialism is good, some is not good...the reason why person wealth should be whatever they can make is because I personally believe our best technological breakthroughs to come will be funded by pet projects from individuals. having a few billion in personal savings may be the catalist to create...donno...warp drive or food replicators...something like that.

I can see value of course in the capping, however I think philosphically it would be a bad idea to limit the growth potential and make us fully depend on our progress to be either governmental or corporations. Not to say that independent billionares have contributed anything of significance to society as of yet (beyond the golden toilet)..but hey, one can hope.

Originally posted by endisnighe
As for the OP, you are going to institute more REGS on business? Excellent idea, we all know government regulation has helped us over the last 40 years!

indeed it has, ask any woman or black man at work and they will fully agree that sometimes intervention has a positive result

besides, this is barely interventionism, its rolling back the work hours to increase employment and raise the dollar value.

you cant keep pushing a broken car down the road forever...eventually you need to stop and fix it.

reply to post by SaturnFX


Capping wealth would stimulate innovation and economic growth, how is that bad? Social engineering goes on all the time: check out the threads on drug-testing welfare recipients: social engineering to the max.

Resistance to capping wealth is counterproductive and a result of ingrained capitalist propaganda, because in reality, without their wealth, most of the super-wealthy are incapable of successfully competing with the "lower classes". They lack the social skills, depth, and braod social experience necessary. Outside their protective bubble they wilt and fade rapidly.

reply to post by SaturnFX


I think we can institute a model where we give tax breaks to firms to make capital investment in plant and equip and allow them to be exempt from payroll taxes for two years. You would have to have something in there so that firms would not lay folks off only to hire them back to avoid taxes for the two years.

We can also cut corporate taxes based on the number of folks who are given alternative work environments which saves companys money, not only in facilities, but also in productivity. It has been proven that most folks working from home work more hours than folks going into the office. Essentially they work their commuting hours. This would also be environmentally and congestion friendly.

The largest thing though is for this administration to settle on an economic policy and have the fortitude to stick with it. The problem is credit and nobody will loan any money because the banks and lending institutions don't know what the economic policy will be hence guage the credit worthiness of potential clients. Credit is the biggest problem.

I work in IT and the reason for the large amount of unemployment and under employment in IT is that companies can not get credit to upgrade their infrastructure. Most technology is leased, not purchased and if you can not get favorable terms for a lease, you simply extend. A significant portion of the US IT workforce is dedicated to regular refreshes in infrastructure which it typically turned over every three years. Most firms have not refreshed infrastructure since '08, hence the loss of IT jobs.

That has other ramifications as well (just in IT and I don't want to derail the thread with a specific industry). Business risk is impacted, fewer kids major in computer science, etc.

They have to get credit flowing for folks to get jobs. Any other thing is a bandaid

Originally posted by apacheman
reply to post by SaturnFX

 

Capping wealth would stimulate innovation and economic growth, how is that bad? Social engineering goes on all the time: check out the threads on drug-testing welfare recipients: social engineering to the max.

Resistance to capping wealth is counterproductive and a result of ingrained capitalist propaganda, because in reality, without their wealth, most of the super-wealthy are incapable of successfully competing with the "lower classes". They lack the social skills, depth, and braod social experience necessary. Outside their protective bubble they wilt and fade rapidly.

The next problem is that it simply wont happen...it wont..any politician that even suggests it will be fed to the lions (multibillionare lions at that). Its a unrealistic idea...bit like saying we should abandon currency and start trading hugs...
The idea itself...sure, great...but it simply will not happen in this world. we would need a near extinction event wiping out almost everyone for a full restructuring like that.

I guess what I am focusing on is somewhat massive yet potentially doable changes in how we do things in the short term...

Consider the politics of the day...Obama said he is going to remove the bush installed tax breaks for people recieving over 1/4 million a year and people have called him everything from the reincarnation of Stalin, to the antichrist...can you imagine what would happen if in this political environment someone suggested capping wealth at any level? the right would take up arms lead by hannity, limbaugh, beck, and the corporations that own them. it would be a nightmare.

Every idea that we currently hold and use was described the same way to start.

It can be done if the argument is framed properly.

For instance:

BILLIONAIRES FINANCING TERRORISM!

Headlines like that repeated ad nausem would quickly turn public sentiment and have billionaires calling for caps, since it's probably true. You see, when you have so much money you can't count it, how do you KNOW you aren't financing terrorism? Somewhere a company you own is providing material and financial support for terrorism, because you can't keep track of everything they do.

Or how about:

STUDIES SHOW BILLIONAIRES ARE ADDICTED TO WEALTH-BUILDING; CAN'T CONTROL IT!

ARE GREAT FORTUNES A SIGN OF MENTAL ILLNESS?

These are probably true, too. At least with enough truth to create the proper atmosphere to discuss the issue.

Framing the argument is quite important, with proper framing anything can be accomplished.

I have heard that immigrants to the U.S. don't have to pay taxes for 7 years. I believe it and If this is true, imagine all the money that could be spread around if they did have to pay taxes like every other American. I bet there would be less immigration and a little more money to distribute as needed.

reply to post by SaturnFX


I like your outside the box thinking. I am actually a proponent of 4-10hour days, as it give people more days off each week. This doesnt solve any employment problems but i think that workers would be happier with this type of schedule. 2 day weekends are a joke.

With regards to the comment about having 1billion dollar caps. I think there should be laws capping how much the highest paid workers within a company can make compared to the lowest. The company itself has no cap, it can make as much as they want. This is a way to ensure that the wealth of the business is distributed more evenly among all the people to help make it function.

I think the value that is placed on certain jobs compared to others is very messed up. The janitor in a company is many times the least paid employee, but that business cannot function without that role. So in some respects, the janitor is just as important as every other job. Unless, the CEO, decides he/she wants to clean bathrooms.

If the janitor makes $10/hr, the highest paid worker can only make $50/hr. If the highest paid worker wants a raise, everyone else must get one.

This move would also eliminate the need for unions in many cases because by law the company would be required to pay all of its employees in an equal fashion. And if this law was established, it would even the playing field for all businesses.

Just a thought.

France is having a great time with all that modification of the work week. Socialist programs don't work. Capitalism isn't working either. What is the middle ground?

cutting down full time to 30 hours woud not change anything. It would just mean that companies would have their workers work 30 hours in a week instead of 40. if they cut it to 30 and hired more people that would just mean that more people would make less money. If the companies had to increase spending on paying their workers then the price of goods would rise and then you and i would have to pay more for goods and make less money. It would not work.


[edit on 22-2-2010 by zaiger]