Our economy is recovering from the pandemic, thanks to human innovation (see: vaccines developed in months, not a decade), and without the need for massive, debt-fueled government “stimulus.”
Indeed, and as is so often the case, much that government does and has done stands in the way of the recovery the Biden administration is telling us can only happen by spending a few more trillion dollars. To wit: employers are finding it harder and harder to get hire enough employees.
Has the unemployment rate dropped to the “effectively-zero” level that it was at pre-pandemic?
Hardly. It currently stands at 6.1%, about 60% higher than a year and a half ago. The U5 rate, which includes “discouraged workers and all other marginally attached workers,” is also well above pre-pandemic levels.
So, what gives?
Everyone knows the answer. The government gives. As in the “extra” unemployment benefits being paid as part of pandemic relief are enough to incentivize people to stay home rather than go back to work.
Incentives matter. Pay more for something, you get more of it. Pay people more to stay at home, and they’re going to do so.
A normal reaction to something like this, a situation where doing something is causing more harm than good, is to stop doing it.
But, no, this is big government we’re talking about here, so instead of saying “things are recovering quickly enough, we can save the taxpayers some money and help the economy by ending the extraordinary payouts,” we get gaslighting:
The way that in our capitalist system — so the way that a market economy works is we work through prices as a signal. … Especially essential workers, their jobs are not risk free, right? They’ve become a little more — a little riskier. And so if employers have to pay a little bit more to compensate those employees to take on that risk, I think that’s appropriate — again in a market economy, where that’s the currency. — Cecilia Rouse, chair of the Council of Economic Advisers and a “top economic advisor to president Biden.”
How in the [redacted] [redacted] is a government distortion of the labor market “capitalism???”
It’s not. The gag here is to assert to the complainers, who are, it’s fair to presume, at least somewhat pro-capitalism, that this is simply their system at work, doing what it does.
This gag is incredibly common, and it fits in quite well with the Orwellian equivocation we constantly see from the Left (as well as being an Alinsky tactic). If something bad is happening, it’s always capitalism’s fault. No matter that, for this to be true, the definition of capitalism must be so corrupted and distorted as to have no meaning.
Capitalism, let’s be clear, is not anarchy. It’s not “do whatever you can get away with.” And it is NOT a system where the government is an economic competitor.
Government, by its very nature (the power to coerce behavior), cannot be a player in a capitalist economic system. It can only distort market forces and market signals with interventional behavior. Its role in capitalism is limited to the protection of individual and property rights and the impartial adjudication of contracts. Paying people to stay home has nothing to do with capitalism or market economies.
That Ms. Rouse can argue otherwise with a straight face, and not be laughed out of the room, is an indictment of both the press (not fans of capitalism) and our educational system (aggressively shielded from market forces).
Sadly, in politics, facts rarely matter. This line of BS will be echoed by partisan defenders of all things Biden, even as the national debt keeps climbing and even as the economic recovery continues to be hindered.
That last bit, by the way, may very well be the point. A strong recovery obviates the argument for stimulus (even if you believe that government stimulus actually works – I don’t), so slowing the recovery may sucker enough of the less-engaged to pressure their politicians to support the next few trillion in government spending.
The Left is all about oppressors and victims, about championing those who are allegedly being kept down by the powerful and the System. The targets of gaslighting, i.e. you, me, and anyone else who understands that Ms. Rouse’s statement is utter horseshit, easily qualify for ‘victim’ status, and should be granted relief by the Left’s white-knight crusaders.
Ms. Rouse has a PhD in Economics. She should know better.
Oh, wait, it’s from Harvard. Now I understand.
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A footnote: Lest you think Ms. Rouse’s view is an outlier, consider this lulu from MSNBC anchor Stephanie Ruhle:
Why is it – that the unemployment benefits are too generous rather than the pay offered by employers too low? Pay more $ = find more workers. If margins are so thin, that you cannot increase pay without passing it through/losing customers = your biz model doesn’t work.
Economic illiteracy, pedigrees notwithstanding, is certainly not in short supply.
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The Government’s spending money is causing a problem Then the only answer is.
for the Government to spend more money.