Quit Multiplying Economics & Make Something

The headlines have been saying jobs are up, jobs are down. Now, we have the official word, uttered by Governor Beverly Perdue herself, that unemployment is up. To combat the problem, the Asheville Area Chamber of Commerce has announced an exciting “5×5 Jobs Initiative.” Hold onto your seats so you don’t blast off! The economic multipliers are making my head spin like Linda Blair’s.

James F. Smith, chief economist with Parsec Financial, forecast a 1-in-10,000 chance that the national economy will actually slip into another recession by the end of the year, given recent good reports in retail sales and industrial production. “Give me a break when it comes to this dopey recession talk.”

But Mike Butram of the Asheville Area Board of Realtors raised the question many people seem to have when economists talk about the numbers. “How come it doesn’t feel like the recession is over?”

The program promises:

• $191 million in new payroll.
• $154 million in new capital outlay.
• $136 million in new consumer spending.
• $62.9 million in local bank deposits.
• $5.5 million in annual sales taxes.
• $672 million per year in total economic impact.

Well, actually I made one of those things up just to show how shot-in-the-dark they all are.

I dare say, Mr. Butram and I must be smokin’ the same stuff, because I thought the way to create a job was to hire somebody, not to unveil a program with wine and cheese and a name that is supposed to capture the imagination of a jaded public. If one cannot afford to hire somebody, they can start adding value to raw materials to start a business.

This is my dopey economics-in-one-minute lesson: What defines prosperity in a society? Perhaps you said lots of material goods or lots of health. How do these things materialize? By people converting resources into usable and valued items. Increasing the amount of money in circulation is not going to increase goods and services. It will just devalue the dollar. Increasing wages will give people more money to spend on items made more expensive to cover others’ wages. Rah-rah programs provide anesthesia to help little infections become gangrenous. So what creates wealth and prosperity? Work. What’s standing between you setting up a lemonade stand or developing state-of-the-art airplane gear? Fees, licenses, zoning restrictions, codes, employment law, forms, etc.

The comments posted in response to both hyperlinked articles above show us masses ain’t as iggorant as the guvner reckons. One particularly memorable one mentions how Volvo left the area, taking 500 jobs, only to be replaced by the celebrated Linamar Corporation, which will provide 400.

As another aside, the Carolina Journal’s headline on Perdue’s assessment of the job exodus lists the following amongst its “Related NC Politics Articles:”

• Topless protest set for Asheville
• Gay marriage ban fight gears up
• Lobbying intensifies to sway votes on same-sex marriage
• Some unions to skip Dems convention

This Little Piece of Candy Won’t Hurt My Diet

The state has $6292 to throw around on youth group mini-grants of $100 to $500 each. A Republican insider recently told me about the woes of Representative Tim Moffitt serving on a committee to decide who gets nonprofit funds from the state. He said applicants would request $100,000 with $80,000 going to their salary when only $20,000 of wage-worthy work was being done. I know, this is nothing compared to the structural deformities of government.

Make Way, You Vulnerable Revenue Generators

Statewide Booze It & Lose It checkpoints will be set up August 19 through September 5. Last year, “more than 11,000 stepped-up patrols and checkpoints were conducted” during the Labor Day infringements on the guilty-until-proven-innocents trying to get from here to there.

“Officials with” Want Money

“Officials with the Great Smoky Mountains” are soliciting input on fees they want to impose on people camping in the woods. To comment, visit www.nps.gov/grsm.