In his inaugural speech President Barack Obama pledged to put America back to work; but is it that easy? For all you students of history, there's an interesting article at Star-Telegram about whether it is likely or unlikely a President can influence the unemployment and job loss rate. Here are a few of the highlights I found most intriguing:
The number of jobs created hasn't always kept pace with the expanding number of people who want to work. Presidents don't have much control over either the number of new jobs or the number of people looking for work.
This is a correct observation. Right now, jobs are contracting, meaning we are experiencing more job losses that we are job growth. More businesses are going bankrupt and completely liquidating such as Circuit City. Those job losses are permanent and can only be replaced by other companies, either new or existing. At the same time, the population is growing, not just in the number of births; but the amount of immigration to the country. This drives up the demand for jobs which may not keep pace with job creation.
The article continues:
Q: Is there anything presidents can do to create jobs?
A: One thing above all else: Build infrastructure.
"We built a lot of infrastructure in the Eisenhower, Kennedy, Johnson era," Haines said. "I'm sure the interstate highway system created an incredible amount of employment. We can do it again."
Projects such as mass transit systems, bridges and harbor development not only can put people to work, they can increase productivity dramatically.
"One of the reasons India lags behind China in its growth is China has better infrastructure," Haines said.
Infrastructure is good. It's always good to improve a nation's roads, sewer systems, bridges etc.; but where exactly are we getting the money for this infrastructure if the tax base is decimated by foreclosures and job losses? Yes, we should build infrastructure and employ as many Americans as we can; but we need to create and strengthen systems designed to protect Americans financially. Systems such as bankruptcy need to receive the full support of the new administration so that we can protect America's assets while rebuilding and creating new jobs if we want our investments to payoff not just now; but in future generations.