T Nation



So if these numbers are right I think there are some major issues.

According to this graph private sector employment is at the same level it was back in mid 1999. Though 11 years have past and we have grown the population by 31 million we have not added jobs.....

Also of unprecedented nature is that we have actually broke a 100 year trend and have began to trend downwards.


Why ?

According to the article -

  • Resources were misallocated during the boom period.
  • The government made low-skilled workers artificially more expensive
  • The government made unemployment more financially attractive.
  • The government is making employee health benefits more expensive by an unknown amount.
  • The Fed is making long-term planning far more difficult.



You are enunciating some of the true issues of capitalism. Pure capitalism only gives a person something for something (money for labor and so on). But yet it is human nature to want something for nothing. So humans will set up governments (called democracies) whose implicit purpose is to gain something for nothing -- bankers want to make profits with no risk, common people want free healthcare, and so on. These goals cause cognitive dissonance in not only individuals but large swaths of people.

As Aristotle rightly determined, this society eventually collapses and we eventually revert back to a command system.

Is it possible to ever have a stable system that is not prone to collapse? Marx thought so; when everyone was happy to live a very simple live and no one wishes to accumulate, then humanity would have no need of any system except communal-ism. I don't think so simply because social systems of highly intelligent and unpredictable beings are CHAOTIC.

So since chaos is built into life, simply accept it. Assume that most people will starve to death or die from horrible diseases or in some horrible war. That's life, embrace it.

War is all and all is war.


Very good post HH.


Seriously. How are people not more shocked by this? The same amount of jobs as 11 years ago! Think about it.

This is the FIRST time since good data has been keep were a later recession hit lower job figures then the one prior to it. IE - the trend is now "down".

Doesn't this worry you guys? aren't you concerned? Were you aware of these figures? Do you dispute them?


Creating a job and creating work are two different things. We don't necessarily want to create more work.

I think the government should subtract all of the work it creates in the form of government jobs as these jobs do nothing to provide anything to society but rather takes stuff away.


Does this mean pure capitalism wouldn't allow for ownership based income?


No. It is not possible to plan a social system. Every system breaks down eventually, simply because humans are unpredictable. Someone invents the internet and all hell breaks loose. Someone gets the brilliant idea to package NINJA loans (subpar mortgages) and palm them off as AAA securities and all hell breaks loose. Someone invents the cell phone and Facebook and the Middle East explodes into chaos.

Darfur is the normal state of humanity, not the peaceful and well-ordered suburbs of the United States or Japan.

Learn to love it.


You're very Hobbesian aren't you?


100% valid but I do not think that's what's going on right now. As an economy becomes more and more productive and efficient less people, or at least a smaller percentage of the population, should have to work - yes, but has the economy really increased it's output by such an amount over the last 10 years that we can be resting at the same number of jobs, with a larger population, and have the same kind of per-capita output as before? Most likely not.

True, but these numbers are for private sector jobs only. Or are you saying to subtract the government jobs from the private jobs?


I believe that using continuous functions to plan human societies (like Soviet Russia, Mao's China, Hitler's Germany, and yes our own mixed economy) is sheer madness.

That doesn't mean we won't try it.


Very good post.


I dont know much about economy but I see parallels between this and what happened and is still happening in a lot of 2/3 world countries (such as in Brazil and Mahgreb countries). The economy has grown and is still growing but the increase in the number of people has been stronger, and people actually have less than before and there is a lot of unemployment.It's too bad that we already consume more in a year that the earth produce. Time wont solve this problem.

Unemployment is the real reason for the revolt in the arab world. They dont do anything (other than hoping to be accepted as immigrants), they have no future and present. It's pretty grim. Now in order to prevent them to spread their general unhappiness on us I dont think we should accept them in our country. If we accept some people why don't we accept them all? Hey let's just switch our entire populations! I am quickly drifting further out of the subject.


"Confirming just how leveraged hedge funds and general investors were exiting February is the latest margin debt data from the NYSE, which indicates that the recent trend of pursuing beta on ever increasing margin continues.Total margin debt jumped by a whopping $21 billion from $289.6 billion to $310.3 billion, the highest it has been since July of 2008. It should, however, be kept in mind that this is a gross leverage number. To get the far more accurate net number, one needs subtract the margin debt from Free Credit Cash Accounts and Credit Balances in Margin Accounts, or in other words, the "net worth" of the investor (the less the supporting cash, the lower the "capitalization ratio" of the speculator). And here things get very concerning. The Net Free Credit (or net margin debt depending on whether one puts the + or - sign in front), calculated as Total Free Credit less Total Margin Debt jumped from ($46) billion to a massive ($57) billion. This is the third lowest net worth reading ever reported by the NYSE. Only the ($67.8) billion in May 2007 and ($79) billion in June 2007 are worse, and confirm that everyone is levered to the gills at virtually the same level as when the market was at its all time highs. We all know what happened next."


The Fed created another bubble, this time in stocks. Once again our leaders think they can manipulate and control.

When will people learn that only LF capitalism is flexible enough for chaotic systems?