Politics

 

 

We have been seeing a vigorous attack against government jobs and spending. In fact, the 2012 elections will be largely about the size of government and the place of government programs in a nation that has always, rightly so, prided itself in being a country of entrepreneurs and private business.

 

Undoubtedly there is a huge amount of waste and certainly fraud in government programs. I’m one of the biggest fans of rooting it out and actually throwing the crooks in jail - not just fining them as we do now (FYI fines are just the cost of doing fraudulent business).

 

The latest statistics show the U.S. economy growing at a slow but steady rate with private sector job creation increasing monthly. But “public jobs” are declining at the federal, state, and local level. That accounts for a significant percentage of the disappointing jobs numbers.

 

As I was driving north in New Hampshire recently I was astonished at the massive road construction on Route 93. They are widening the road, adding new overhead bridges, blasting a lot of rock (NH is the Granite State!), and landscaping the heck out of that road. It got me thinking.

 

This highway project in New Hampshire as well as other states (I drove through nine of them recently from Iowa east) creates a lot of jobs for the private contractors and sub contractors who have been working on these projects for at least three years now.

 

As I drove on up to Concord I realized that all of these workers and their families had good jobs because of federal stimulus money as well as state and federal highway funds. They don’t appear in statistics as “government” employees. These hard working men and women probably are opposed to “big government.” And, in November they in all likelihood will vote for politicians who promise to slash big government spending all the while unaware that they are voting against their own jobs. (PS: “Private highways” have not been financially attractive although there are a few of them and some “private bridges” as well.  It’s hard enough to get people to pay tolls on public roads.)

 

When I consulted the books I also was made aware of the fact that there are huge chunks of the American economy that would also shrink and die off without public spending.

 

Think U.S. defense. No private corporation or private equity fund (think Wall Street) would finance national security. There is no market for it. No fighter bombers, armored vehicles, body armor, military and intelligence satellites, new helmets, 21st century field hospitals in combat zones, new fleets of ships for the Navy and Coast Guard would exist. These are all technically “private sector jobs” on the books because these products are contracted out to private sector firms whose employees are not “government workers.” How misleading is that since the jobs wouldn’t exist without Congressional appropriations.

 

One of my best friends works for a large pharmaceutical company that has two products prescribed primarily to the elderly. When I had coffee with him recently we talked about Medicare and Medicaid. He pointed out that without these programs (paid for by “big government” taxpayer money) his company would not have even invested in the research and testing of these products because the market for out-of-pocket purchases would be way too small. Multiply this by all the medical supply companies. Think Hoveround medical power scooters (“You may be eligible to buy at NO COST TO you through Medicare and Medicaid!” says the TV ad.) Think about GE medical imaging and all of the jobs created by just these two government initiated health programs but none of them listed as “government jobs” because we “launder” the spending of public, taxpayer dollars through private companies making it look like it’s a vigorous private sector. In fact, these are “outsourced government jobs pretending to be private enterprise. How many older folks do you think would buy Hoverounds ($3,000 +- with necessary accessories) and the Hoverlift for vehicles ($2,000) without Medicare or Medicaid?

 

How many ethanol plants would have been built without government incentives?

 

Would we have technology to launch satellites into space without NASA and the U.S. military? Even as we now privatize space ALL of the R & D that makes this possible was government funded.

 

And, would you be reading this on the Internet on some sort of electronic device without ARPANET, the government financed secure military research network program of the Defense Advanced Research Projects Agency (DARPA) that made the Internet possible?

 

And, we know that much of the housing and other construction in the United States would not be possible without government guarantee programs that make banks even think about giving mortgages to most Americans. Ditto for peoples’ trust in banks, Savings and Loans, and Credit Unions that would be virtually nil if the federal government did not insure and guarantee the security of your money in these institutions. Just look at Greece and Spain where the government does not guarantee CDs and deposits and there is virtually a run on banks. For that matter look at the U.S. BEFORE these government programs were put in place – think run on banks Great Depression.

 

So lets clean up and tighten up government spending for sure. It is a disgrace how much waste and fraud there is. It’s also clear that in many instances unions have been corrupt and abusive and have lost the trust of many Americans. I had lunch with one of the most liberal Democrats imaginable recently and he was furious at what unions had done to his family’s small business and he hates unions! What a shocker that was!

 

But let’s also be truthful about how important pubic programs and funding are to significant private sectors industries and services in the United States. It’s a public private partnership that had made us such a prosperous country. Let’s be careful and thoughtful about how much we slash and damage one side of that vital partnership.