2016 Presidential Election: Job Creation
The job market is in the dumps, especially for young people.
Luckily, politicians have come to the rescue!
Trump promises he’ll be “the greatest jobs president that God ever created.” And Bernie plans to spend $18B to get our economy back on track.
But if government takes tax money from some businesses to create jobs in others, who will really feel the burn?
Subscribe to our channel for more election analysis with Don Boudreaux and non-stop binge learning all summer long.
Does the Government Create Jobs? (Video): Creating jobs is relatively easy. Empowering the economy and individual workers is not. In this video, Prof. Steven Horwitz explains in doing the former, the government makes the latter almost impossible.
Guide to Election Season (program): 2016 is heating up, which is why we’re cutting through the noise to bring you the most important issues of the election- drug policy, terrorism, immigration, and more. Join Professor Don Boudreaux in this On Demand Program designed to give you the information you need this election season.
When Governments Cut Spending (video): If the government was to cut spending, to stop propping up the economy, the economy would collapse and we’d all lose our jobs…right? Quite the opposite, argues Prof. Steve Davies.
>> I’m Don Boudreaux and today we’re talking about
>> Creating new jobs
>> Invest in jobs
>> Produce jobs
>> Bring back our jobs
>> Get the American people back to work.
A major issue this election year, as in any election year, is jobs. How do we make sure that the job market is dynamic enough so that everyone who wants a job can get one?
Even though the official unemployment rate has fallen below 5%, that number doesn’t tell the whole story. Many Americans are still struggling to find good paying jobs to support their families. Another measure of unemployment, which takes into account part-time workers who want to work full time but aren’t, stands at 10%.
The labor force participation rate, which measures the size of the workforce is only 63%. That’s the lowest number since the 1970s. Youth unemployment is more than triple the rate of the national average. And still has not recovered completely from the recession. When young Americans can’t find jobs, they can’t gain the valuable work experience and on the job skills that they need to advance in their careers.
So, how will the presidential candidates improve the job market? Some, mostly Democratic candidates argue that best way to get the job market truly working again is for government to spend more. They propose ambitious stimulus programs, green energy jobs, and more government and government subsidized jobs in general. In short, they believe that the best way to create jobs is through the government.
This approach sounds good on the surface, but in reality it muddies up the labor market and does more harm than good. While some people win because of the new government created jobs, others lose because of the increased taxes needed to create these government jobs result in fewer jobs for the private economy.
It’s just a way for the government to pick winners using tax payer money, also known as cronyism. In addition to hurting the private sector labor market, this approach leads to an increase in the number of lobbyists and special interest groups trying to get these new government created jobs to come their way.
This unproductive activity grows the size of Washington at the expense of jobs on mainstreet.
>> There is a reason why these people are putting huge amounts of money into our political system.
>> Other candidates have proposed a different approach. Let the private sector, which has made the U.S. the richest country in the history of the world, work smoothly by limiting the roadblocks to offering and accepting a job.
This approach means reducing and simplifying taxes. A lightened tax burden leaves businesses with more money to spend on expansion and job creation. It also means eliminating counterproductive regulations, regulations that unnecessarily increase the difficulty of creating and of accepting a job. For example, outdated occupational licensing regulations make it illegal for some professionals to work in their desired field.
It can take years to open up a barber shop or become a personal trainer because of the licenses needed to do so. Obstacles such as these not only hurt customers looking for haircuts or good workouts, they also hinder job creation. In short, these candidates believe that the best way to create jobs is to lower taxes and remove the red tape standing in the way of entrepreneurs, workers, and consumers.
So, which approach do you think is better for creating jobs? More government spending or reducing the burden on entrepreneurs?