Jobs at what cost?

Hey ho... what goes?

The stock market registered a gain of 53 points on the Dow yesterday. Gold saw a modest gain too.

And the White House came right out and with a straight face said it had saved two million jobs.

How do you like that?

More than seven million jobs have disappeared in the correction so far. But the total would have been more than nine million, had it not been for the feds.

Let’s see, $700 billion worth of stimulus spending... hey, that’s $350,000 per job. But every dollar of deficit is actually ‘stimulus spending’.

At that rate, each job cost about $800,000.

And what about all the Fed’s pump priming?

What about all the loan guarantees and toxic asset purchases... and bailouts of the auto industry, AIG, the banks, mortgage holders, Fannie and Freddie... etc, etc?

That’s all stimulating too, isn’t it?

The total is said to be around $13 trillion, putting the cost at $65 million for each job saved.

Of course, it’s all hooey... all nonsense... all balderdash.

It makes sense to ‘save’ a job if and only if the job didn’t need saving.

In other words, the jobs that are worth doing are worth saving... but they don’t need saving.

Why?

Because a job that is worth doing is a job people will pay for. And if they won’t... or can’t... it’s NOT worth doing.

Otherwise, the feds could have 100% employment... just as they did in the Soviet Union. Give everybody a job. What the heck, give everybody two jobs! But it only really does any good if the jobs are productive.

And how can you know if they’re productive or not? You have to wait for Mr Market to tell you. If a job is productive, people will pay for it. If not, well... the job is cut and/or the business goes bust.

Mr Market never gets a say on government jobs, however. That’s why the feds can say any fool thing they want.

Washington, DC, is full of government bureaucrats who earn 30% to 50% more than people in the private sector.

In the private sector Mr Market puts his thumb up or his thumb down.

The job is saved. Or the job is cut. But here in the federal city his thumbs are in his pockets.

For example, every day, we drive by the NIH – National Institute of Health. Thousands of cars go in and out every day. The NIH was set up in 1930. It had 140 employees, which seems like more than enough.

Today, it has 18,442.

The same sort of employee inflation happens at every government level on practically every government project. You set up an agency or a commission. Then, you can’t get rid of it. As the saying goes, ‘nothing is more eternal than a temporary government agency’.

But are Americans any healthier thanks to the NIH’s 18,000+ employees? No one knows.

And that’s just the NIH... where employees may conceivably be doing something worthwhile...