Zero unemployment, if you please
Bloomberg is one of my favorite news dailies on the global scale. Believe it or not, I have never visited their website but based on what I have sourced from my own local daily, it seems to be a site well worth spending time on. Well, just as soon as I get a steady stream of monthly income going again. Having been officially off the job market map for the last couple of years, I remain, to all intents and purposes, unemployed. The reason for this has more to do with me personally than the economic climate over the last few years, particularly since the last global markets financial crisis back in 2008.
The crisis was caused by a spate of reckless lending by the country’s biggest banks which occurred over a number of years and was essentially the fault of former US President, Ronald Reagan, and former long-serving Fed Chairman, Alan Greenspan, who both argued in favor of rigorous deregulation of the financial markets industry. This happened back in the eighties and these two men succeeded in getting their way through both Houses, Congress and the Senate. George H Bush let business continue as per usual.
Bush’s conqueror in the next presidential election, Bill Clinton, saw the writing on the wall and famously remarked ‘It’s the economy, stupid’. Earlier, Bush had promised hard-working Americans that there would be ‘read my lips, no new taxes’ (words to that effect). Many political analysts believe that this is what cost the former CIA director his presidential job. Clinton knew full well that money, sustainable growth and development and ultimately jobs for all is what mattered most. In spite of sordid sex scandals, Clinton served his full quota of two terms as president and radically reversed the country’s crippling debt.
But then Bush’s son went and erased the progress that had been made. You see, it’s a long-standing tradition in American politics (and economics) that it is always left (pardon the pun) to the Democrats to fix the country’s crippling debt and get the country’s economy to grow again. And where there is growth, markets take note. When big-spending investors pump more money into the stock markets, business opportunities open up and, so too, more job opportunities. Outgoing US President, Barack Obama, has basically put the nation on a growth trajectory and its unemployment rate is at an all-time historical low.
And yet, this morning, I read the remarks of less than half a dozen economic and financial analysts who are a lot more skeptical than most other naysayers who disagree with the current White House administration’s economic strategies. They believe that the drastic reduction in the unemployment rate as well as the possible hiking of the interest rate next month will precipitate a recession. Now, I’m no economist, but surely it is better to have a job, full or part-time, and be able to contribute towards stimulating the country’s economy.
Also, I happen to believe that raising the interest rate is a good thing. Volatile markets remain subdued in terms of growth. Interest rate hikes, surely, should encourage us to work harder towards reducing our own debt and freeing up money to make necessary savings to stimulate our own personal growth for the long term. The Oracle of Omaha, Warren Buffet, seems to have similar thoughts, still believing in making investments in sectors and companies which are likely to see growth over the long term and avoiding riskier short term ventures.
That is why I’m ending my note with a call for zero unemployment, if you please. Thank you.