Reduce unemployment by firing more people

FluffyMcDeath

FluffyMcDeath

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It seems like such a good idea to some people - like those that tell the UK government what to do.
Businesses are hurting because demand for their products and services is incredibly weak. The obvious cure for this seems to be to fire the people who would be consumers so that companies can save money. Then they will be able to hire all these unemployed people back at lower wages. All these low wage people will somehow be able to produce more consumer demand than the higher paid employees who were let go to save money. If this doesn't work then you can simply repeat the cycle. Eventually when everyone is working for free then consumer demand will undoubtedly take off.
If even that fails then perhaps they will have to charge people to work.
 
FluffyMcDeath said:
It seems like such a good idea to some people - like those that tell the UK government what to do.
Businesses are hurting because demand for their products and services is incredibly weak. The obvious cure for this seems to be to fire the people who would be consumers so that companies can save money. Then they will be able to hire all these unemployed people back at lower wages. All these low wage people will somehow be able to produce more consumer demand than the higher paid employees who were let go to save money. If this doesn't work then you can simply repeat the cycle. Eventually when everyone is working for free then consumer demand will undoubtedly take off.
If even that fails then perhaps they will have to charge people to work.
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Even better if you reduce the total number of jobs (ie jobs no longer there and won't be counted again) and have people so depressed they stop looking for work, your unemployment percentage drops and the government can brag it's policies are correct and things are moving in the right direction as unemployment percentage is down.

I know it's seems strange to you, but business is in business to produce a profit. If they have too much out lay in labor costs, they have to bring down the labor costs so they have a profit. If you are looking to pin the misery a bad economy brings to the people, it's not the fault of business for shedding unneeded jobs, it's the fault of the central government and central bank for taking too much money out of the economy for business to stay profitable with it's current labor force.
 
and these corporate idiots are so stupid they don't realize they are shooting themselves in the foot
 
Dammy said:
I know it's seems strange to you, but business is in business to produce a profit. If they have too much out lay in labor costs, they have to bring down the labor costs so they have a profit. If you are looking to pin the misery a bad economy brings to the people, it's not the fault of business for shedding unneeded jobs, it's the fault of the central government and central bank for taking too much money out of the economy for business to stay profitable with it's current labor force.
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It's been long observed that there are certain immediacies of business that tend to make a bad situation worse. Keynes wrote about this negative feedback during contractions - business owners need to cut costs when there are no customers so they shed labour. This reduces the number of customers and so business owners are forced to further cut labour. It is why Keynes advised governments to act counter to this behaviour and to act as a moderator. The idea was to pump money into the economy when things were slowing down and then to tax it back out when things were starting to heat up. Unfortunately we don't really have a Keynesian system. We ended up with a government that spent to stimulate the economy and then when the economy was steaming along they spent more and cut taxes based on the assumption that the economy would keep going up and they'd easily make the money back in the future.

What happened instead was all the money that the government put out they borrowed and the the money ended up in the hands of private bankers who could lend the money back to the government at interest. It's a great scam if you can pull it off and once you start to succeed you end up with enough money to buy all the politicians you want so you can keep the gravy flowing. Of course, there were still some annoying laws that could get in the way of this vast money engine and prevent it from using its full influence but Citizens United has cleared much of that away. Bribery is now virtually unlimited.

Yes, the government has played a part in this but it is the private individuals that have accumulated the wealth that are now the problem. They are so powerful that they can now squeeze further concessions from the economy even if it kills people. Even businesses that are fundamentally healthy are crushed when banks that are sitting on heaps of capital decided that they won't roll over a businesses operating credit. If you can't cover the 90 to however many days between buying your supplies and getting paid by customers it doesn't matter what your profit would be, you won't be around by the time it would come in.

For the rest of the economy to function when the hoarders won't put their money into the economy, someone else needs to do it and there is only one someone else who can and that is the government. And being the government they don't even really need to borrow the money - they have the power to issue it directly. If they had used this power since 1913 instead of putting money into circulation by borrowing it from the Fed (who create it out of nothing) then there needn't have ever been a debt at all.
 
exactly.....

FluffyMcDeath said:
And being the government they don't even really need to borrow the money - they have the power to issue it directly. If they had used this power since 1913 instead of putting money into circulation by borrowing it from the Fed (who create it out of nothing) then there needn't have ever been a debt at all.
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but... and correct me if im wrong here ....if the gov had issued currency it would have created "known" deflation immediately , "borrowing" from the fed allows for the same "devaluing" of the currency but in a muddied water way that makes it easier to hide....
 
FluffyMcDeath said:
It's been long observed that there are certain immediacies of business that tend to make a bad situation worse. Keynes wrote about this negative feedback during contractions - business owners need to cut costs when there are no customers so they shed labour. This reduces the number of customers and so business owners are forced to further cut labour. It is why Keynes advised governments to act counter to this behaviour and to act as a moderator. The idea was to pump money into the economy when things were slowing down and then to tax it back out when things were starting to heat up. Unfortunately we don't really have a Keynesian system.
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Problem is Keynesian system that it's extremely flawed. It's been a failure for FDR, Nixon (and to lesser points Carter and Bush), and now a complete disaster under Obama after spending $5T in new debt which is pushing America towards $20T in total debt by 2016.
 
Dammy said:
Problem is Keynesian system that it's extremely flawed.
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The problem with the Keynesian is that we don't have one. Did I just type too much in my post so that your brain shut down? We are not here from following Keynes, we are here from ignoring Keynes. And we are here because a large number of our masters don't have any patience and have decided to cut the goose open so they can get all the eggs right now.
 
Firing people when times are tough isn't the key problem. Spending too much and not saving enough for tough times WHEN TIMES ARE GOOD is the problem. But it seems to be against human nature to save when things appear plentiful. This is probably because thousands of years ago it just didn't make sense to save. Most things back then were perishable, and would last just a few hours or days. You killed a big animal? Eat it as fast as you can because if you don't, the bacteria or other scavengers will. And if you can't eat it fast enough, no worries, just kill another one, after all scavengers need to eat too. So I do believe the Keynesian model makes sense, it'll probably never catch on.
 
FluffyMcDeath said:
The problem with the Keynesian is that we don't have one. Did I just type too much in my post so that your brain shut down? We are not here from following Keynes, we are here from ignoring Keynes. And we are here because a large number of our masters don't have any patience and have decided to cut the goose open so they can get all the eggs right now.
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doesn't help that the masses are so stupid no decent financial system can be put in place that will work anyway... if it doesn't fix stuff overnight and with all the fan fare of the "publishers clearinghouse sweepstakes" theyll never go for it anyway... and will immediately elect in the next batch of buffoons who promise to only loot the system less than their predecessors...
 
Glaucus said:
Firing people when times are tough isn't the key problem. Spending too much and not saving enough for tough times WHEN TIMES ARE GOOD is the problem. But it seems to be against human nature to save when things appear plentiful. This is probably because thousands of years ago it just didn't make sense to save. Most things back then were perishable, and would last just a few hours or days. You killed a big animal? Eat it as fast as you can because if you don't, the bacteria or other scavengers will. And if you can't eat it fast enough, no worries, just kill another one, after all scavengers need to eat too. So I do believe the Keynesian model makes sense, it'll probably never catch on.
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if I wasn't such a compulsive saver I would never have survived being an artist.
 
I'm pretty frugal too, but I've never been in a situation where things seemed limitless either.
 
i would say "it is "more unlikely" to be the former (or whichever makes the most sense and is prolly right)" ... now i just say it's "moron likely"... u can call it reverse country charm.... :D
 
:lol: that's convoluted enough to almost confuse me
 
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