Unemployment is a mounting issue that continue to steal the headlines of papers and blogs across the nation, and the world for that matter. Jobs being lost, outsourced or simply disappearing overnight are every day events. Plants shutting down, companies closing their doors, and the most financially stable name brands we grew up with calling it quits are on the tips of our tongue. So how do we address this? The free markets that we have come to understand are the driving forces of the western world. The markets have grown to expand and touch every nation, and have integrated a world economy that was formally fragmented. With that comes a great deal of change, both positive and negative, for countries around the globe. Economies are shifted in moments, and the effects can be disastrous. As we all know, with such change the opportunity for upside is well present. Risk is not bad, it simply needs to be managed. So when people, companies and countries manage their risk responsibly, we hear of the tales of riches made in days or months. All this to say, there is good and bad with a global economy that is changing.
However, there is another side of the economy and that is the government. Governments are involved in every nation taxing business, setting up social responsibility, and governing the people within their borders. But in recent years, the governments of the free world have taken a change in their approach to risk and are now in the business of mitigation. People have come together that do not like the risk others are taking, and now are taking their position to the government to ensure that legal changes are made to prevent such action in the future. Issues such as compensation regulation, off-shoring legislation, tax issuance, and other topics all surrounding business are now in the hands of the government. The government does not have a proven track record of success when it comes to managing finances of the people. So why should we be placing the finances of free market trade into their hands? Bottom line we should not. This is a larger mistake than anyone can realize. When we revisit history and look at the past performance of the governing parties – there is no reason that any government should be running free companies or dictating their policies.
Unemployment is high and there are various reasons why this is, but the government stepping in is not going to solve the issue. Look back at the Obama administration statement that without government intervention, unemployment would hit 8.8%. Then why WITH intervention has unemployment hit over 10%, and in some cases 12%? Conventional wisdom was that by pouring money into the system, companies would not need to let people go but rather further there investment for the future. But the government did not consider the “mind of business” and rather used a very academic approach to the subject. When companies saw things were going south, they took money and stabilized their balance sheets. This did not change the business climate of the world and therefore the jobs were still cut. How the government arrived at the idea that throwing money at something was going to solve it, I have no idea. But with this sort of approach have they also begun looking at the other subjects I mentioned above. Simply put, we need another solution.
I am not saying the free markets are perfect. Far from, and I believe that the government should have governance to ensure that the consumers are not taken advantage of or pushed into a no win situation. But that is the extent the government should play – there it begins and there it ends. A government that exceeds those rules and begins to dabble in things they know little about becomes a government spread to thin, and thus not effective to the core responsibility of ensuring the peoples’ safety. Where does this leave us…it leaves me with a mind full of ideas and no way to implement. There are ways to head off unemployment and steady the strength of the nation without government interference. Take for example the following idea. Infrastructure projects that have countless dollars allocated to them have seen little headway in the recent year. Albeit this was the cornerstone for the creation of many jobs the administration boasted about. Why the lack of movement? Too many people running the projects, no direction. If the government is giving money, they need to place conditions on their loans or injections of cash. We are giving you 50MM for this project, you must hire 1000 people to handle this, we are assigning a project manager from the government to run and oversee it, and then we will sub contract the remaining. But that is not how they play out. 50MM is handed out, no direction given other than a statement and nothing happens. It is like giving 200 dollars to a 5 yr old and telling him/her to get food for the week. No car, no understanding, no idea what or where to buy things – that is the way our government recklessly assigns money.
In the midst of the heavy debate, I will side with government being the worse of the two. What do you think – please let me know. Check out www.workfanatic.com to follow all the news related to the workplace.