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Tuesday, July 30, 2013

Outside the Box Ideas to Improve Economy & Fight Poverty

When it comes to how to create jobs, reduce poverty and overall make everyday people's lives better economically, politicians always fall back to stale, tired concepts..

"We need to lower taxes on individuals and businesses...

"We need to make sure people have a good education..

"We need to give people hope..
Nope..  All 3 have been tried separately and in some combination of one another... success has been limited and intentionally incremental...

Still have millions out of work.. still have people unable to make ends meet or eating down their live savings rapidly to the point they'll one day get there...

Nothing's really fixed..

So here's two outside-the-box ideas for how to create jobs, get people working and/or dramatically reduce poverty in this country..
1)  Government subsidize the minimum wage

Last year, the US Government spent close to $600 Billion on welfare... (This equals seven months of QE spending by the Fed which is artificially growing the stock market for sole benefit of the economic 1%...)

And while this money spent on welfare allows people to barely make ends meet and afford to put a little food on the table, often welfare discourages people from working simply because a person really can't survive on welfare or a Wal-Mart type 'career'...

So if one can't make it and have any chance of a future living in a decent present either way, then at least the welfare check gives freedom of the individual to control their time vs the minimum wage earner whose spirit is controlled eight hours a day by bosses..
That's why merging the two is the solution..

The US Government subsidizes milk-- $447 million last year alone to dairy farmers to keep them in business and prevent milk from spiking to $7-8/gal.  (That equals a little over three days of QE spending)..

Why can't it subsidize people?

Here's the idea...  For all wage earners over 25 years old who make between minimum wage ($7.25/hr) and $12/hr, the government is to subsidize that wage by an additional $3/hr...
This means you raised the minimum wage essentially to $10.25/hr without putting any burden upon the businessperson who would under normal circumstances, have to drastically raise prices or go out of business..

It means now the lowest wage earners would see an additional $6,240 in their pockets to pay bills or have a little something to save away for a rainy day..

And most of it the government would get back anyways in the form of taxation but this would allow the lowest paid workers to keep about 100% of their actual paycheck.

$3/hr increase over the span of a month comes to $480
2)  Set up a 'maximum' work week

Nearly 7.6 million Americans work two jobs..

And while we all tend to look at this as admirable-- hard working people doing everything they can to survive and build a future-- it also has a negative impact on employment

Every second job someone has, is a position that is not needed to be filled by another; someone who may have no employment.
So one solution albeit a little controversial is to set up a 'maximum' work week of 55 hours a person can work altogether no matter how many jobs he/she has.

So if you work a 40 hour work week, your second job can be no more than 15 hours weekly...   If you have a part time job that requires 30 hours, you can work up to 25 hours more in the other job, etc...

This forces employers to essentially 'create' jobs for a portion of the workforce they do not wish to give opportunity to.. those without a current job.
And if you don't give opportunity to those who need it most, then how can one ever get hired and thus be 'attractive' to other employers?

For some reason, companies are more likely to hire someone if working for another while applying for a position..

Its this principle of popularity-- the more liked you are, the more wanted you are by others... Ex: the girl who has many boyfriends she casually dates is more appealing to a guy then the girl sitting all alone every weekend..
Setting up a maximum work week of 55 hours would probably force at least 2 million people to give up their second job or seek reduced hours... But this would create about 2 million new openings and then we're talking about unemployment consistently under 6%

There's other outside the box ideas which could be implemented to change the economic fortunes of the US so all benefit but we don't want to burden the reader with endless reading.

Besides, we'll save those ideas until we're anointed.. um..  elected.