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Government interference perpetuates unemployment

Published November 27. 2010 09:00AM

Unemployment statistics are in for last week and the news in not good. There were 439,000 new victims added to the unemployment insurance rolls. Economists say that this was slightly better than expected and is cause for joy. I look at the families affected by these job losses and I am concerned for them and for our nation. Americans want to work. They want to support their families by their own labor and their own efforts. This morning, I heard the Secretary of Labor suggest that we need to again extend unemployment insurance benefits or 2 million people will be kicked off the dole. I am a compassionate man, but 99 weeks of unemployment insurance is far too much. Extending it is foolhardy and will result in a further decline in the economy as cash is transferred from those who are working to those who are not.

Hilda Solis, the Secretary of Labor, stated this morning that unemployment insurance benefits support the economy. Without benefits, more than 1 million additional people would be unemployed. She may hire the best economists and statisticians in the world, but she certainly does not have any common sense. How can paying people not to work be productive in an economy? Those who work create products and services that add to our gross domestic product. Those who do not work drain our economy. With people like Ms. Solis in control, is it any wonder the economy continues to be recessionary? I do agree with her comments that we should increase our efforts to retrain the unemployed. We need more skilled craftsmen, more doctors, more nurses, more teachers and more farmers. We should promote training programs for the unemployed and encourage their efforts to rejoin the labor force. When they graduate, we should assist them in finding employment.

There are several things that contribute to the instability in the labor market and the rise in unemployment. The first is uncertainty over the Bush tax cuts or as I call them the Obama tax increases. Small business owners have no idea of what 2011 will hold for them. They do not know their tax rates, and they do not know if the recession will ease. Government inaction on the Bush tax credits is paralyzing small business people who must make decisions for their 2011 operations. This means uncertainty in the marketplace, which increases unemployment.

The politicians we fired in the last election are trying to quickly pass laws in the lame-duck session. I warned about this in July ( and it is becoming a reality now. Senator Reed is pushing immigration reform by working to pass the DREAM act in this lame-duck session. He is also attempting to pass a new Food Safety Act that will place onerous regulations on every farmer. This legislation will be the death knell to a cornerstone of America, the family farm. My question to Senator Reed and all the other elected officials in Washington is: Did you hear us on November 2? We sent you a message. We want jobs! We want the economy to improve! We want America to return to the greatness that it had just three years ago. We don't need a Food Safety Act and we do not need the DREAM act. What we need is for the our elected representatives to get out of the way and let small business and farmers lead us out of the recession. Stop passing laws that are unnecessary. Instead, pass laws that will encourage job creation or better yet, do not pass any new laws. We have enough of them to last several lifetimes. If the politicians want to do something positive, then let them deport illegal aliens, the more the merrier! Americans want to work. They will take any job that lets them support their family.

As for those currently on unemployment insurance, let's try to get them back to work. When the benefits run out, give them a hiring priority where possible. We should encourage corporations and small business to employ American workers. As we retrain the unemployed, give small business and corporate America an incentive to hire these people. If we could subsidize the first few weeks of their employment, they could have an edge in getting a job that they need and the chance to restore their belief in themselves and the contribution they are making to society.

We also need to think outside the box when it comes to manufacturing. We need to bring back the made in America label and encourage consumers to buy American-made goods. I know that many of our factories have moved overseas. Now is the time to bring them back using modern technology and American ingenuity to redefine the workplace and make American-made products competitive again. Volkswagen built a new concept factory in Dresden that can be a model for the regeneration of American factories. (

There is nothing preventing us from building factories like this in downtown Detroit, Cleveland, or any other dilapidated city in America. Take a few minutes to view this video, it will show you what can be done to create factories that are clean and efficient and make the employees proud to work in the facility.

We should fund new factories not continue unemployment insurance benefits indefinitely. Our political leaders should be working on ways to encourage businesses to invest in America. Create jobs here, and create those jobs now. As workers fall off unemployment insurance, let's encourage them to find a job, start a business or go back to school to learn a new occupation. Unemployment benefits should be shortened over the next two years from 99 to 50 weeks and then back to 26 weeks. In my opinion, the best way to solve the unemployment problem is to encourage the unemployed to take the jobs that are available.

I also have to report some good news. Last weekend I was driving around Pennsylvania. Every diner I passed was full. For four decades I have used restaurants and diners as my indicator of impending economic changes. When a recovery is coming, the restaurants fill up. When the restaurants are empty, a recession soon follows. This truly is good news for America because it means people are starting to spend again. I believe we should still be conserving cash, but making necessary purchases is good for the economy. All I ask is that each of us buy American-made product whenever we can.

I also noticed that corporations are hiring again. I don't think that the recovery will be as powerful as previous recoveries. Some of the unemployed will not find jobs. Over time, I believe that we will face a labor shortage as the aging population retires, shrinking the workforce. In three or four years, those who want to work will have jobs and be paying taxes. It is my hope that the recession is ending and our people will go back to work. The dark days are behind us, the clouds are dissipating, and sunny days lay ahead. We have much to be thankful for. On this holiday weekend please take a few moments to thank God for all the blessings we have been given.

© 2010 Gordon Smith - All Rights Reserved

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