France and Greece elections - Austerity fails?

[kandrathe]

I really don't think you would ever find opposition to this in a general sense, but the devil is in the details. How would this be overseen? Would any business that hires a few part-time workers at minimum wage get a sweet low-interest loan? What if the business hires a few workers for the loan, then fires them all because of "unsatisfactory performance"? Who, exactly, is going to oversee this and be sure that each and every business that is participating in this is not taking extra advantage?

I'm assuming that the government of Canada is similar to that in the US when it comes to withholding taxes on payroll. Businesses in the US are required to file taxes on a quarterly basis, and submit SSI/FICA (social welfare) taxes each payroll, which include the name, number, hours worked, and wage for every employed worker. Would it be hard to adjust the terms (rate, length, amount open to borrow) of business loans depending on the number of new hires/ hours worked within the date range of the program? I don't think it would be difficult at all. I would make the borrowing levels for a company a formula based on the number of new hires, and hours worked. It would be pretty easy to administer.

As an aside, computers being what they are today, it boggles my mind that the government has to rely on sampling surveys (of businesses) to measure unemployment. The government knows the work status of most employed persons (working for businesses). Since every person at birth is issued a social security number, we also know the population, and their ages. The numerator is all the people coughing up their payroll tax, the denominator is the number of people (living) on the social security roles between 18 and 65 (granted some people work < 18, and > 65 -- that factor can be an adjustment). The only fuzzy area for employment for our governments should be the types of employment where tax liabilities are not reported until year end (e.g. the gardener, neighbor boy who mows lawns, house cleaner, nanny, and most anyone who works for private individuals -- typically cash businesses).

I don't worry too much about France in general but what I think is a huge problem is that countries are at the moment only trying to work in the interest of big banks and those are much more interested in not having a crash than in healthy economies.

Well, if Sarkozy was only the sacrificial lamb, perhaps there is nothing to worry about. My opinion is that it is not really just the austerity issue of changing the way spending occurs, but change and uncertainty in general.

Some good things are happening in Europe because of the crisis. In countries like Greece and Italy an effort is made to fight corruption and that was sooooo necessary.

Good systems are audited, and "transparency" and openness brings sunlight to the dark secrets and exposes the corruption. But, again, drastic changes are generally bad, so this should be a house cleaning, not a house burning.

The only problem is that there are also taken a lot of austerity measures that specifically target the already weak.
Corruption fighting has to go a lot farther.....not only looking at the little guys but attacking the rich ones.....because if that is not happening in 10 years everything is back to normal again.

My advice would be to divert spending where it will not negatively impact the economy in a large way. For example, rather than buy a new aircraft carrier, which does employ some people to build and operate, but unless you *really* need "defense", it adds little to economic growth. It would be better to divert that money into a program that directly invests in growth industries. Realistically... what we are talking about with military spending here in the US and there in Europe is projection of force and intimidation... I mean, why do those Libyans keep our oil under their sand? We need a military to ensure the status quo of extortion delivers the oil to us at a price per barrel that doesn't stagnate our economies.

I think one mistake from our stimulus package was money used to directly employ people for 2 years. The money ran out and we had a 250,000 worker spike in unemployment. I believe that the best use of government at this time is to help build the enterprises that hire people, not to hire people directly which only adds to the tax burden on the tax payers, or in more debt. Most of the problem in thinking about government spending is that people only start from the governments budget. What they don't think about (reminiscing Bastiat), is where that money the government has came from, and what useful things didn't happen because the government appropriated it and often invests it poorly. In the US, this manifests itself as giving the same modest social security payment to a rich man like Warren Buffet, and to an impoverished homeless elderly person in NYC merely because means testing would turn it into a poverty program. I don't understand the frivolousness of gathering 1$, spending it, then 40 years later borrowing $100 to give that person social security when they don't need it. Or, another way we waste our money is in spending thousands, to hundreds of thousands of dollars on medical treatments for extremely elderly people in their last few months of life. Studies are showing that often for these frail people, its also the trauma of the expensive treatments that shortens their lives.