Reenergizing America

Over the weekend, I described Rick Perry's jobs plan as unattainable. I still feel that that is the case. It will take a long time before the job numbers that he mentioned are actually realized, and he will be long out of office when that is the case. However, I do agree with Perry that the energy industry can create jobs:

We can create hundreds of thousands of jobs and increase our oil output by 25 percent if we fully develop oil and gas shale formations in the Northeast, mountain West and Southwest. I also support drilling in Alaska’s Arctic National Wildlife Refuge coastal plain (ANWR), offshore expansion in the Beaufort and Chukchi Seas, and development of the National Petroleum Reserve in Alaska, all of which would maintain the Trans-Alaska Pipeline System. This will create more than 185,000 U.S. jobs.

The numbers are ambitious, at least for the immediate future. In fact, some think the plan would take years to materialize jobs:

"It's not going to be overnight," said David Dismukes, associate executive director for the Center for Energy Studies at Louisiana State University. "These are big capital-oriented investments. People don't turn on a dime with these investments."

There's a lot of potential in energy though:

"I don't know any other industry that can bring this quantity of jobs to the market," she said. "We have the potential that's not being realized and it could be."

With the unemployment rate as high as it is, it makes sense to ease some of the restrictions in order to get some of these industries working. It's not just the drilling and mining that will create jobs, there's a trickle down effect:

With millions of Americans clamoring for employment opportunities, there is no excuse to delay. A study released last month by the Woods Mackenzie research firm found that 1.4 million jobs and $800 billion in new government revenue could be created over the next two decades by removing barriers to increased domestic oil and gas production. These are high-paying jobs, available now, and private industry—not the taxpayer—is making the investment.

The two main political talking points are jobs and balancing the budget. This would help both of those things. By enabling these projects, they can spur industry. It will help construction of plants and drilling sites. It will bring management, it will bring financial support. There's a lot of potential in spurring this industry.

Versus digging up and rebuilding perfectly fine roads, this is a much better solution. This actually creates new jobs that will last, rather than creating new work. This expands an industry that will not only provide jobs, but will also provide tax revenue from these new projects. It's really a no-brainer.

Under the Microscope: Job Creation

Since I called out Obama for not knowing how to create jobs, I guess I should tackle this issue.

My main beef with Obama is that he's using fiscal stimulus to try and create jobs. The way he's spending just isn't working. The economy continues to suffer even as he's spending billions of dollars "creating jobs:"

What’s clear, however, is that the Obama Administration badly needs a re-start after a(nother) disastrous August that saw the president’s numbers drop to record lows and the country descend deeper into economic pessimism.

Assuming that the jobs report shows in the neighborhood of 60,000 jobs created, it would provide fodder to Obama’s Republican critics who have long argued that not only are his policies not working but that the administration has little idea what else to do to make things better.

Despite this, it seems that President Obama wants to do more of the same:

President Barack Obama signaled Monday he'll propose a major infrastructure program and an extension of a payroll tax break in the jobs speech he planned to deliver Thursday before a joint session of Congress.

While the state of this country's infrastructure is a topic for another day, at what point will Obama realize that "creating" construction jobs is creating work not jobs. Once these projects are completed, there's nothing left to do unless you spend more money on improving infrastructure. It's just a spending spiral that he's creating. You can't do that.

The GOP has not made job growth a priority:

But issuing a call for jobs isn't as simple as it may seem. While the new jobs numbers present the GOP with an obvious issue with which to hammer the president, Republicans in Congress and out on the campaign trail have spent much of the year focused on a different economic area: fiscal austerity and proposals to pare the big federal budget deficit.

However, it seems that it will become a more contested issue. Mitt Romney outlined his plan today:

Standing in front of a large banner that read “Day One, Job One,” Mr. Romney detailed the 10 actions he would take the first day of his presidency. Five of them are executive orders, and the other five are pieces of legislation that he would send to Congress and request action on within 30 days.

“The right course for America is to believe in growth,” Mr. Romney, a former Massachusetts governor, said at McCandless International Trucks. “Growing our economy is the way to get people to work and to balance our national budget.”

The way I see it, in terms of the difference to approaches, Romney is putting the money back into the households and to the businesses, while Obama is using that money to spend on creating jobs. Clearly it's more efficient Romney's way. I'm not convinced that how great an effect it will have.

Jon Huntsman had an op-ed in the Wall Street Journal this morning:

Our entrepreneurs are harmed as much by overregulation as by overtaxation.

I believe that this is more the way to go.

Henry R Nothhaft had this to say yesterday:

We know, for starters, that 100% of net job growth in the U.S. comes from entrepreneurial start-ups, as a Kauffman Foundation report documented in 2010. If you took start-ups out of the picture and looked only at large or incumbent businesses, job growth over the last 35 years would actually be negative. In the words of Kauffman's Tim Kane, "When it comes to U.S. job growth, start-up companies aren't everything. They're the only thing."

While big companies may have to hire or fire people from time to time, they're, for the most part, mature companies. They're not going to continue to grow. The new technologies that are born and the new jobs are spurred by small businesses:

As I noted in an article last year with retired chief judge Paul Michel of the U.S. Court of Appeals for the Federal Circuit, which handles patent appeals, simply clearing the patent backlog could create up to 2.25 million jobs by 2014. And it wouldn't cost the taxpayer a dime, since the patent office is the only self-supporting agency of the federal government.

The problem with the current government is that they're not spending money right. I don't trust a government that is going to take tax payer money and misappropriate it in misguided band-aid programs.

While I'm not satisfied with the Republicans' plans thus far, I feel their plans will better alleviate the troubled economy because it will allow households and firms to choose where to spend that money. Deregulation has been mentioned by several candidates, but there hasn't been a specific plan laid out. Hopefully, as the election trail heats up, the candidates will be pushed to come up with specific ways to fix the economy and to create jobs.

How About Better Transportation Resources?

Obama wants to improve roads and infrastructure:

Obama will tout proposals to improve roads and infrastructure during a campaign trip to Ohio, but that message was largely eclipsed by a renewed political battle over tax cuts for wealthy Americans set to expire at the end of this year.

I personally think it's a waste because I've seen a road near my house that was dug up and redone several times over the past year. Why don't we just have better alternative forms of transportation. In this day and age, there should be no excuse for not having cities with modern transportation such as a subway. Plus commuter trains would help ease access to urban jobs and reduce automobile usage. I feel strongly that we need to increase these alternative transportation resources. It's so easy to get around in Europe. Why is it so hard here?

He also wants to continue the tax cuts for people making less than $200,000, but not for people making more:

"We strongly believe that a healthy, vibrant, economically viable middle class is key to economic recovery and we strongly support the extension of tax cuts to the middle class," an administration official told reporters ahead of Obama's trip.

"But it's also true that we don't have 700 billion additional dollars to borrow to pay for tax cuts that essentially will go to millionaires," he added.

"Saving that $700 billion and applying that to the deficit is a much better use of that money."

Meanwhile, people are still struggling to get jobs. There's no job growth. How are people supposed to pay these taxes without jobs? Additionally, how is the government going to cut spending if it has to continue supporting these people. This is just a disgraceful situation.