Monday, August 17, 2009

The Worst is Yet to Come

Although Bill Anderson doesn't focus on Federal Reserve money manipulations, he has everything else pretty much correct, when he writes:

The Obama administration continues to subsidize the weak sectors of the economy and punish the healthy sectors to pay for this largess. It is an unsustainable pattern. Furthermore, many of the worst aspects of his policies have not yet kicked in, and when they do, the damage will be severe.

First, we have to realize that the trends of mass layoffs had to end, albeit temporarily. Bankrupt Wall Street firms and General Motors already have shed huge numbers of workers and are having a lull, as the government bailout cash has stabilized these outfits – for the time being. There still are healthy firms out there, but they won’t be healthy for long, as the government is going to punish any company that is profitable with higher taxes, more onerous regulations, and other wealth-stunting.

Second, the effects of the environmental policies such as “cap and trade” and other new regulations have not yet been fully felt by U.S. employers. Don’t kid yourselves about how onerous these new laws and regulations are going to be. They will put many companies out of business, drive other business overseas, and add to our unemployed.

Don’t be fooled by the “millions of new green jobs” rhetoric coming from Congress and the New York Times. For every “green” job created by building windmills or other horse-and-buggy technology items, many regular jobs will be eliminated. If ever there were a Frédéric Bastiat “broken window” moment, it is found in the “green jobs” nonsense.

Third, increases in the minimum wage will take their toll on lower-wage workers, while other new labor and “workplace safety” policies are going to make it more costly to run a business. That will translate into layoffs soon enough.

Last, whether or not Obama’s health plan will pass Congress intact is irrelevant. The government is going to make medical care more costly, less available, and a greater financial burden on employers and employees. That is a given, and it also translates into higher rates of unemployment

1 comment:

  1. As it's always been "It's not coming out of my pocket" attitude remains in work place the said article will surely be true. As the gap between the "Haves" and the "Have Not's" grows even larger, yes things are going to get worse. It's a known fact when you die you can't take your money with you. So when large corp execs, med size and some small business owners pocket the big bucks and pay the minions peanuts because they are "entitled" then yeah "The worst is yet to come"