Companies are obtaining greater output from their employees, increasing labor efficiency and piling up profits, much of which appears to be hoarded. This has been the news during the entire "recovery". A "statistical recovery" as it has been called.
Dwelling on this admirable increase in efficiency misses the point, however. The question is, why has there not been private investment in new businesses to take advantage of the large pool of skilled and unskilled labor eager and willing to work? Why has there not been private investment in new kinds of industry, to take advantage of the years of scientific discovery in America's great research universities? Why has there not been private investment in new businesses to take advantage of the huge supply of empty factories, empty warehouses, and empty commercial officies, when the commercial occupancy has been at the lowest in years?
For some reason, the free market place of capitalism is not working. The factors of production, which are at their cheapest in decades, remain underutilized. Capital literally lies around, waiting to be taken and profit wrung out of it, and nobody appears to care. Why? Why? Why?
My instinctive guess has to do with the role of government in business. Notice that the Democratic government intervened in the economy to favor with government subsidy and policy incentives a few particular industries. These industries, such as green energy and high speed rail transportation, are not efficient and will always, for the lifetime of their operation, require high subsidies obtained through high taxation. Companies are compelled by government to look at these subsidies and incentives like the California or Yukon gold rush. They don't have to do anything to reap the governmental gold. They can even lie and deceive and get away with it. They can promise to build a factory in Michigan to make car batteries for electric cars, then put the factory in China, and still collect their subsidy. They can propose to build wind turbine farms for generating green energy, then purchase Chinese turbines, and still collect their subsidy on electricity.
The point is not that the government should require "buy American" policies. We don't want buy "American policies", because all they would do is indirectly tax consumers and indirectly provide another subsidy to the companies. We want the companies to be efficient; but to be efficient by using the inexpensive resources, ideas, and labor lying around in the states by starting new businesses. Why hasn't Microsoft, or Dupont, ConAgra taken some of their profit and invested it in new businesses whose prospective products would be beneficial to them. I remember DEC doing this, surely it shouldn't stop.
The point is that government subsidies abrogate the market and prevent companies from looking around and taking advantage of the underutilized resources here in the states. And governmental social welfare polices disincentivize labor and households to make themselves available, as by moving, for new jobs. Companies see this phenomenon, so why start up a new business offering new jobs when workers would prefer to collect unemployment checks, or welfare checks, or food stamps, or remain on Medicaid, and stay in California or New York City or wherever. The Great Recession was caused in part by government modifying sensible market rules about purchase and investment in mortgages (permitting uncreditworthy customers to buy mortgages by paying nearly nothing down), and now the Great Recession is being prolonged by government policies that disincentivize private investment and private companies using the underutilizes resources open to their purchase.
The failure of these policies to create economic growth great enough to lower unemployment is already proved; how much more failure should these policies drive the economy into, before the American public and opposition parties man up and support refudiation of these failed economic policies?
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