Tuesday, April 15, 2014

Encouraging Paradigm Shift On The Right

Encouraging Paradigm Shift On The RightI've published a lot of doom and gloom over the years. After all, the majority Americans believe the country is headed in the wrong direction and has been for some time. But, in these times of rampant pessimism, there exists a ray of hope: the burgeoning liberty movement.

The standoff in Nevada shows that many freedom-minded Americans are drawing a line in the sand. They're standing up literally--as well as figuratively--to an increasingly overbearing federal government. That's good news. It's also good news that the government backed down. That demonstrates that freedom-minded Americans need not depend on elected representatives to make changes in policy. They're able to spark change through their own actions.

There's more good news: although Republicans lag the nation in its change of heart on social issues and foreign policy, more people on the Right are coming to realize that the federal government's marijuana prohibition and interventionist foreign policy are costly like its economic and environmental policies.

The editors of National Review, arguably the most influential conservative publication in the nation, recently published an editorial arguing for the legalization of cannabis. The conservative publication of record has come to realize the high cost of marijuana prohibition, both in terms of currency and human life:
Regardless of whether one accepts the individual-liberty case for legalizing marijuana, the consequentialist case is convincing. That is because the history of marijuana prohibition is a catalogue of unprofitable tradeoffs: billions in enforcement costs, and hundreds of thousands of arrests each year, in a fruitless attempt to control a mostly benign drug the use of which remains widespread despite our energetic attempts at prohibition. We make a lot of criminals while preventing very little crime, and do a great deal of harm in the course of trying to prevent an activity that presents little if any harm in and of itself.
Quite a departure from the Right's "Just Say No" rhetoric of the Reagan era.

More people on the Right are also coming around on military interventionism. Rand Paul, whose non-interventionist view of foreign policy is a 180-degree-turn from a decade of George W. Bush-brand military adventurism, is a serious contender for the 2016 GOP presidential nomination. In fact, according to some polls, he's the leading candidate. In modern history, no Republican nominee for president has had a view of foreign policy anywhere close to Rand's. Even Barry Goldwater was an interventionist.

That's impressive. Even though Rand isn't the libertarian his father is.

These are times of uncertainty and anxiety. But these are also times of an encouraging paradigm shift on the Right. These are times to be hopeful about the liberty movement: it's growing in size and influence, and it's heading in the right direction.

Thursday, April 10, 2014

Infographic: Applying For A Job Through An ATS Minefield

Infographic: Applying For A Job Through An ATS Minefield
Not to beat a dead horse, but I've come to realize the contribution to the unemployment and underemployment epidemic in this country that is American employers' heavy reliance on applicant tracking systems (AKA talent management systems). ATSes are notorious for functional problems and favor job candidates with more degrees and experience over those with more bona fide accomplishments. Due to employers' heavy reliance on ATSes, job searching in this country has become a lottery in which the most capable candidates often get overlooked and up to 50% of new hires "don't work out". ATSes are bad for the economy as a whole.

As the following infographic demonstrates, applying for a job through an applicant tracking system is akin to tiptoeing through a minefield. One's candidacy can be blown up with one misstep, and many completely logical steps for job seekers to take are considered missteps. For example, many applicants make the mistake of submitting their resumes and cover letters as PDFs. Many ATSes can't read PDFs, even though most accept them. The PDF format, by the way, has been the universal standard for electronic documents for more than a decade.

The infographic argues that applicant tracking systems save recruiters time and therefore improve companies' bottom lines. This is myopic thinking. ATSes may save recruiters time, but, despite the graphic's claim that they're a "new technology to connect candidates with their ideal job opportunities" (they're not new), the tradeoff is in fact the creation of a disconnect between jobs and the best candidates for those jobs.

PBS's "Ask the Headhunter", Nick Corcodilos, who sent me the graphic, accompanied it with a great quote:
I love how it explains that “HR finds ATSes save them time.” And heroin makes addicts feel good. That’s a reason to use it?
As you read the infographic, keep in mind that many job seekers who network their way up to a hiring manager are directed down to an ATS.

Infographic: Applying For A Job Through An ATS Minefield

Wednesday, April 9, 2014

The Psychological Struggle Of Long-Term UNDERemployment

 The Psychological Struggle Of Long-Term UNDERemploymentI've written dozens of articles about the epidemic of unemployment and underemployment in this country. In the articles, I've cited numerous statistics. We have to keep in mind that those stats represent people.

There are many accounts of the psychological toll of long-term unemployment. But little has been said about the toll of long-term UNDERemployment. Lest we forget that Gallup pegs the underemployment rate at nearly 20%. Nearly 1 in 5 members of the American workforce is working below--sometimes well below--his potential. And that's only if you count people who work part-time but want to work full-time. That doesn't count the millions of Americans working below their potential in full-time jobs. MBAs working retail. Law degree holders filing papers. Mike Alberti of Remapping Debate tells us what that can do to a person psychologically over time. As you read this, keep in mind that getting a breadwinner job in America has become a lottery in which the best and brightest don't get chosen up to 50% of the time and opportunities for promotion have been limited by the large number of people staying in their jobs.
The many impacts of unemployment — including social and psychological ones — have long been catalogued. But much less is known about the consequences of “underemployment.” Millions of Americans — at least as many as are unemployed, and perhaps more — have either been forced to take part-time work because full-time jobs are not available, or are forced to work in jobs for which they are overqualified.

“We have never experienced anything like this,” said Carl Van Horn, director of the John J. Heldrich Center for Workforce Development at Rutgers University. It is “not something that as a society we’re used to dealing with.”

Since the recession, researchers have begun to take more of an interest in the psychological effects of underemployment, and what they have found is not encouraging. In the short-term, it appears that those who are underemployed — like those who are unemployed — have an increased risk of depression, increased stress, and lowered self-esteem.

And there may be long-term negative effects, too. On the psychological side, there are intriguing hints of a downward spiral that might affect underemployed workers in their family, social, and employment relationships. In economic terms, there is already data that show that the effects of being underemployed directly after graduating from college can linger for more than 10 years.

“Unemployment is an emergency,” Van Horn said. “Underemployment is a crisis.” Nevertheless, the United States, unlike other countries, is not gathering the data needed to pinpoint what the full costs of underemployment actually are. Making it difficult to know which policies might be effective in helping those affected.

What’s wrong with me?

Douglas Maynard, an associate professor of psychology at the State University of New York in New Paltz is one of only a few psychologists who has studied the mental health effects of underemployment.

“There are a few things that we know for sure,” he said. “We see very clear evidence of lower self-esteem, greater stress, and less job satisfaction,” he said.

To illustrate those effects, David Pedulla, a doctoral candidate at Princeton who is writing his dissertation on the consequences of underemployment, suggested considering the case of a worker with a degree in accounting who is laid off from an accounting firm and has to take a new job working in retail.

“Imagine going from a situation where you had gained some status and control over your day-to-day life, and then moving into a retail job with a boss with less education than you,” Pedulla said. “That person might feel like he had lost control over his life.” The theme of loss of control is one that numerous experts cited repeatedly.

Pedulla said that the result is often that underemployed workers internalize a sense of shame, and begin to blame themselves for their situation. Psychologists have long recognized that shame is a very powerful emotion, and that people who feel a strong sense of shame tend to cope with it in different ways.

The ex-accountant working retail, Maynard said, “might start blaming himself for it. He might wonder, what’s wrong with me that I’m here?”

That sense of shame intensifies if the individual has been forced to take a pay cut, Maynard said. Underemployed workers will often feel a greater financial strain, which can be exacerbated because their new jobs may not provide the same levels of health or retirement benefits as their old jobs, while at the same time making them ineligible for government assistance programs.

Pedulla said that, for men, the implications of becoming underemployed and earning less money can have profound effects on their perception of their masculinity, especially if they find themselves struggling to provide for their families.

“The breadwinner model is still very present,” he said. Men who feel that their masculinity is being threatened are more likely to lash out at their families. There is evidence that underemployment can cause marital strain, Pedulla said, and that when older children perceive that there has been a reduction in income or status, they may “inherit” the sense of shame.

“Kids may feel like they can no longer have the newest clothes, or that they can’t do certain activities with their friends because their family can’t afford it anymore,” he said.

Social isolation

One of the strongest effects of the shame and lowered self-esteem that can result from underemployment is that the worker may become socially isolated — in the workplace and outside of it — and that the isolation can, in turn, reinforce those feelings because the worker is not receiving social support, experts said.

“Your social interactions might change,” Pedulla said. “If you were laid off from a job where you had friends, you might feel less inclined to see your former co-workers because you might fear that they would look down on you.”

Some research has found that workers who have been laid off and found new jobs that are unsatisfactory are less likely to engage in social activities. In 1988, Katherine Newman, a sociologist and the current dean of the School of Arts and Sciences at Johns Hopkins University, wrote an influential book called Falling from Grace: Downward Mobility in the Age of Affluence, in which she interviewed hundreds of people who had, for various reasons, fallen out of the middle class.
Several people reported that the social consequences of underemployment can be particularly challenging.

“If your old friends are going out for drinks or going to the theater or playing golf or doing other things that you can no longer afford to do, then that can be a very isolating experience,” she said.
Berrin Erdogan, an associate professor of management at Portland State University, said that underemployed people might find themselves isolated within the workplace as well. “You would probably feel like a misfit, especially if you are surrounded by people who are less educated than you,” she said.

She used the example of a young worker who graduated from college but could not find a job in her field, and had to start working at a coffee house. “After work, [your co-workers] might go out or spend time together on the weekends, but you might be less inclined to go because you feel like you don’t fit in,” she said. “At the same time, there’s a great chance that your co-workers might feel intimidated by you, and won’t want to invest in a relationship with you.”

Erdogan said that that situation could quickly lead to anger and “self-defeating behavior,” which could affect the way that underemployed workers do their jobs. “If you don’t feel appreciated in your job, and feel like it’s unfair to be there, you might not do your job as well. If you’re working in a coffee house, in the end you may not end up treating your customers very well,” she said.
In his research, Maynard has found that workers who perceive themselves to be overqualified for their jobs report less job satisfaction even than workers who are involuntarily employed part-time.
Erdogan said that evidence also exists that workers who are overqualified for their jobs are more likely to have bad relationships with their managers and co-workers, and that this can make them more likely to get fired from their jobs.
“If you don’t leave a job on good terms,” she said, “that in turn diminishes your chances of finding another job.”

Depression and boredom

Psychologists stress that the duration of underemployment is a very important factor. If a person finds a better job within a few weeks or months, said Daniel Feldman, associate dean of the Terry College of Business at the University of Georgia, the negative psychological impacts are more likely to be limited.

But if the worker remains underemployed for more than six months, Feldman said, it would be a short step from the combination of boredom and self-doubt to clinical depression. Researchers have shown that depression is strongly associated with underemployment, especially if the person is making less money than he or she had come to expect. Others have also found that underemployed workers are just as likely as the unemployed to show signs of depression.
Going back to the example of a worker who went from an accounting job to a retail job, Feldman said that a huge factor would be the dissonance in the worker’s mind between his present situation and the future that he had imagined.

“You went from doing something where you were using your skills to folding shirts,” he said.  “That’s a very strong contradiction [of] the idea that you had of where you were going to end up.”

“You’re going to be constantly bored with that job,” he said. “You’re never going to be happy working there.”

Depression has long been linked to self-destructive behavior such as an increased incidence of alcoholism, drug use, aggression toward family members, and suicide. While little research has been done examining the incidence of these behaviors among underemployed people, the connection between self-destructive behavior and unemployment is quite strong.

“We would expect to see many of the same effects in some underemployment situations,” said Meghna Virick, an associate professor of management at San Jose State University.

Feldman has also found that if workers who are laid off blame themselves for losing their jobs, there is an increased likelihood that they will engage in self-destructive behavior.

Characteristically, people who suffer from depression can have strong feelings of shame, guilt and worthlessness, as well as fatigue and irritability. They can also lose interest in things that were once important to them, such as their families, friends, and hobbies.

“People spend a huge number of their hours at work,” Pedulla said. “It’s central to the construction of their identity. If that work is making them depressed, then it’s easy for that to affect other parts of their lives.”

Unfulfilled hopes and diminished expectations
Though many researchers speculate that underemployment can have long-term psychological effects, it is an issue that has not been studied in depth. But several experts worried that, if the situation does not improve quickly, it could lead to a sense of unfulfilled hopes and diminished expectations, especially among young people.
“If you’re going into the labor market and have a particular idea of what your future is going to look like, and what you actually find is quite different, that has an effect on how you perceive yourself and how you perceive your chances for the future,” said Sarah Anderson, a professor of psychology at the University of South Australia who has long studied underemployment.

Returning to the example of the ex-accountant who works in retail, Feldman said that after a certain amount of time the worker might start to become discouraged. “If you don’t get out of the job after six months, you become increasingly pessimistic that you’re going to get out of it at all,” he said.
That could mean that the worker stops looking for other jobs, or approaches the job search with “less gusto,” Maynard said.  Because the job search can quickly become an exhausting process, especially while an applicant is working at another job, he or she may not put in as much effort after a prolonged period of time, he added.

“Some people might cope with being underemployed by changing their expectations, and saying, ‘I guess this is as good as it gets for me,’” Maynard said.

The job search can reinforce that sense. Several experts in management said that employers might be less likely to hire an applicant for a job if the applicant has been clearly underemployed, leading to a vicious cycle from which the worker cannot extricate him or herself.

If the worker is ensnared in this vicious cycle, Maynard said that he or she might begin to feel a sense of “learned helplessness” in which the person stops trying to actively change his or her situation. “If you’ve been applying to jobs and hearing nothing back, you may start to feel like you have no control over your life,” he said.

And many researchers have noted that the mental health effects of underemployment are most severe if workers feel that they have lost control over their situation — if they begin to feel trapped in their current jobs. “That is the point when we would expect to see the worst mental health outcomes,” Maynard said.

In the current context, that is particularly disturbing. There is some evidence that shows that during a recession, workers are less likely to quit their current jobs, because they are less likely to believe that they will be able to find another one. Before the recession, an average of three million people quit their jobs each month; in September, that number was slightly over two million.

Lack of data
While the understanding of the consequences of underemployment is growing, many of the experts interviewed for this article said that there is still a long way to go.

“There is much less empirical research than we would like,” said Pedulla. “Before we know how to respond effectively, we need to understand the contours of the problem better.”

“In Europe,” said Portland State’s Berrin Erdogan, “underemployment is treated as a social problem. We don’t even pay attention to it that much.”
One reason why so little research is done on underemployment is that it is important to have what’s called a “longitudinal” data source to draw from, which means data that follows individuals through time to measure what effects result from changes in their situations.

While the U.S. does have a few longitudinal data sources, they are generally limited in the amount of information they contain. Much of what is known comes from data from other countries, especially in regard to mental health and to more subjective measures like perceived well being.

Longitudinal data collection is more expensive and more time-consuming than normal survey studies, and while a few universities have the resources to conduct them, the responsibility generally falls to the government to provide the funding and support. Virick of the San Jose State University said that the recession should have served as a wake-up call to policy makers that this is an issue that demands attention.

“We haven’t had any kind of organized response to this,” she said.
According to Erdogan, the United States is paying much less attention to the issue than European countries. “In Europe, underemployment is treated as a social problem. We don’t even pay attention to it that much.”

Whose fault is it, really?

Few people would suggest that mass underemployment is somehow the “fault” of the people who are underemployed.

“Underemployment is now a structural feature of our society,” said Newman of Johns Hopkins. “Structural problems demand structural solutions.”

Nevertheless, several researchers said that, in the United States, there is a strong impulse for underemployed workers to blame themselves for their situation, which is the source of many of the negative mental health effects associated with underemployment.

“If people don’t understand that there is a way that the system has become rigged against them, they may start feeling like they’re to blame for their issues,” said Anderson of the University of South Australia.

Anderson said that appreciating the broader structures that created underemployment was an important part of a strategy to avoid falling into the trap of self-blame.

“I like to hope that we’re starting to see people realize that the ways the workplace has changed in the last few decades have not been positive for most workers, and to try to change that” she said.
Newman agreed. Seeking to address the systemic causes of problems “can be a very healthy coping strategy,” she said.
"Underemployment is now a structural feature of our society." Truly tragic. The terrible result of the wicked trifecta of impediments to prosperity that is the Fed, the federal government, and applicant tracking systems.

Thursday, April 3, 2014

Another Biz Reporter Rips Applicant Tracking Systems

Another Biz Reporter Rips Applicant Tracking Systems
As many of you know, I firmly believe that HR hiring software--AKA "applicant tracking systems"--, which far too many American enterprises offer job seekers as their only port-of-entry, exacerbate our nation's unemployment problem and detract from companies' bottom lines (and therefore detract from the economy as a whole). So any article I come across that's critical of ATSes gets my attention.

In this article, CIO's Meridith Levinson describes applicant tracking systems as capricious and fundamentally-flawed. She hammers home the fact that the expensive, unwieldy software American enterprises often empower as their exclusive employment gatekeepers arbitrarily reject potentially great employees. As you read the article, keep in mind that half of Americans ages 18-29 are either unemployed or underemployed. Think about how younger Americans who have less experience (and therefore have fewer keywords and numbers on their applicant profiles) and who have a smaller professional network (not that that matters much when hiring managers direct applicants to their ATSes) might be at a significant disadvantage under this hiring paradigm. This is, after all, a paradigm in which even the most talented applicants are judged by poorly-designed computer software based on experiential criteria only. Remember, an ATS will always select someone with more degrees or experience over someone with more accomplishments. Why? Because ATSes CAN'T IDENTIFY ACCOMPLISHMENTS.

Lou Adler, entrepreneur and best-selling author, best summarized this phenomenon in an article he recently published on LinkedIn:
“Successful candidate will develop a new approach for reducing water usage by 50%,” is a lot better than saying “Must have 5-10 years of environmental engineering background including 3-5 years of wastewater management."
- See more at: http://www.ecominoes.com/2013/05/the-american-hiring-paradigm-is-broken.html#sthash.KkCw7bIz.dpuf
Lest we forget what Lou Adler, entrepreneur and best-selling author, recently stated on LinkedIn:
“Successful candidate will develop a new approach for reducing water usage by 50%,” is a lot better than saying “Must have 5-10 years of environmental engineering background including 3-5 years of wastewater management."
In this case, ATSes would always choose candidates with more years of experience over those with more accomplishments that would suggest the capability of reaching the goal of reducing water usage by 50%. In fact, many ATSes require applicants to list "responsibilities". Anyone can have responsibilities. Only a select (read: overlooked) few have bona fide accomplishments. Anyway, on to the article:
Applicant tracking systems are the bane of legions of job seekers. These systems, which employers use to manage job openings across their enterprises and screen incoming resumes from job seekers, kill 75 percent of candidates' chances of landing an interview as soon as they submit their resumes, according to job search services provider Preptel.

The problem with applicant tracking systems, as many job seekers know, is that they are flawed. Very flawed. If a job seeker's resume isn't formatted the right way and doesn't contain the right keywords and phrases, the applicant tracking system will misread it and rank it as a bad match with the job opening, regardless of the candidate's qualifications.

Bersin & Associates, an Oakland, Calif.-based research and advisory services firm specializing in talent management, confirmed the weaknesses of applicant tracking systems. In a test conducted last year, Bersin & Associates created a perfect resume for an ideal candidate for a clinical scientist position. The research firm matched the resume to the job description and submitted the resume to an applicant tracking system from Taleo, arguably the leading maker of these systems.
Taleo is notorious for producing ridiculously buggy software. There used to be a great blog that described in detail the numerous functional problems with Taleo's products. Some of these problems have been fixed with recent releases. Many have not. And the fundamental flaws persist, as they do with all ATSes:
When Bersin & Associates studied how the resume rendered in the applicant tracking system, the company saw that one of the candidate's work experiences was lost entirely because the resume had the date typed before the employer. The applicant tracking system also failed to read several educational degrees the putative candidate held, which would have given a recruiter the impression that the candidate lacked the educational experience necessary for the job. The end result: The resume Bersin & Associates submitted only scored a 43 percent relevance ranking to the job because the applicant tracking system misread it.
Every American hiring manager should read that last sentence.
Josh Bersin, CEO and president of the firm, notes that since all applicant tracking systems use the same parsing software to read resumes, the results his company found would be typical of most systems, not just Taleo's.

The problems with applicant tracking systems beg the question: If they're so flawed and if they filter out good candidates, why do employers bother to use them? The answer is simple: Bersin says they still make recruiters' lives easier. 
Stop right there. American enterprises don't use ATSes to find the best potential employees. They use them to make recruiters' lives easier.  Let's analyze that in terms of risk and reward: To reduce the workload of their recruiters, organizations spend billions of dollars annually on buggy software that arbitrarily eliminates a significant number of talented applicants. Under that paradigm, up to 50% of new hires "don't work out". Does the end of convenience for HR workers justify a unquestionably broken means of hiring? Levinson goes on:
Applicant tracking systems save recruiters days' worth of time by performing the initial evaluation and by narrowing down the candidate pool to the top 10 candidates whose resumes the system ranks as the most relevant. Even if some good candidates get filtered out, recruiters still have a place to start. 
Better said, recruiters have a good "place to start" with the applicants who are lucky enough to win the ATS lottery and get through to a human being. Those applicants may or may not be the best candidates.

PBS's "Ask the Headhunter" Nick Corcodilos said it best:
Unemployment is made in America by employers who have given up control over their competitive edge -- recruiting and hiring -- to a handful of database jockeys who are funded by HR executives, who in turn have no idea how to recruit or hire themselves.

Tuesday, March 4, 2014

The Post-1990s Fed: Enemy Of The Middle Class

The Post-1990s Fed: Enemy Of The Middle ClassBy reading well-respected scholarly works such as David Stockman's The Great Deformation and Nouriel Roubini's Crises Economics, I've come to see the Fed as the threat to the vitality of America's Middle Class it's become. But one need not delve into hardcore economic research to reach this conclusion. One need only have common sense and possess the ability to read charts.

In the mid-1990s, Alan Greenspan's Fed began our central bank's tradition of pumping massive amounts of liquidity. Since that time, stocks and other assets typically held in large quantities by the wealthy have done--for the most part--very well. But, for middle class Americans, who rely on "breadwinner" jobs for their livelihoods, the past 15 or so years have been a period of economic decline, the past 6 years a period of economic free-fall.

Since peaking at around 67.5% in the late 1990s, the labor force participation rate has declined to 63%, the lowest level since the 1970s, when households rarely sent more than one member into the workforce. The S&P 500, on the other hand, has more than doubled:

The Post-1990s Fed: Enemy Of The Middle Class - Labor Force Participation vs. Stocks

Corporate profits and labor force participation also decoupled in the late 1990s. Today, there is little correlation between the two:

The Post-1990s Fed: Enemy Of The Middle Class - Labor Force Participation vs. Corporate Profits


What's more, part-time jobs have been replacing full-time jobs since the Fed's tech bubble:

The Post-1990s Fed: Enemy Of The Middle Class - Part Time vs. Full Time Jobs


And, since the late 1990s, real wages (adjusted for inflation) have been in decline:

The Post-1990s Fed: Enemy Of The Middle Class - Annual Change In Real Wages

Another reason to gnash your teeth: there's evidence that the Fed of the new millennium has been aware that it's been propping up the wealthy at the expense of the Middle Class.

Monday, March 3, 2014

Capricious Mandatory Minimum Sentencing Hurting America's Future

Capricious Mandatory Minimum Sentencing Hurting America's FutureMandatory minimum sentencing, sentencing requirements imposed by state legislatures and the Legislative Branch of the federal government, is a clear violation of the principle of "separation of powers" that strips judges of their fundamental duty of administering justice considering the circumstances surrounding the cases they oversee. Mandatory minimum sentencing is infamous for being unfair to minorities, but it also harms a disproportionate number of young people of all races. Each year, tens of thousands of young Americans are imprisoned and tens of thousands more lose their student aid eligibility due to capricious mandatory minimum sentences, mostly for minor drug offenses.

Mandatory minimum sentences ruin the educational and economic opportunities of young Americans in a number of outrageous ways. Consider the following tragic stories:
Truly tragic. Fortunately, Alex Kreit, Associate Professor at Thomas Jefferson School of Law, is providing a free web-based program to equip participants with the knowledge and the tools they need to help end the injustice of mandatory minimum sentencing. You can find out more about Professor Kreit's program, part of the Learn Liberty Academy at The Institute for Humane Studies, by visiting the program's registration page.

Empowered by the education Professor Kreit provides, you can then work with organizations such as Families Against Mandatory Minimums and Students for Sensible Drug Policy to help end mandatory minimum sentencing.

Thursday, February 27, 2014

Hispanics And The Future Of Liberty

Hispanics And The Future Of LibertyIn these times in which most Americans believe the country is headed in the wrong direction, there exists a ray of hope: the burgeoning liberty movement. But the movement, as encouraging as it is, has a fundamental problem: demographics. According to the Pew Research Center, 85% of self-identified libertarians are non-Hispanic whites. To put that another way, 85% of liberty-minded Americans are of an ethnicity that will become a minority by 2043. Conversely, Latinos, who will become the nation's largest ethnic group by mid-century, largely abstain from the liberty movement. According to the same Pew study, American Hispanics comprise only 7% of the libertarian cohort.

That's a major problem. But it's one that can be corrected.

Offering websites en castellano, some liberty-oriented organizations such as the Mises Institute and the Cato Institute have taken initial steps to educate Spanish speakers about freedom. But these sites primarily cater to liberty-minded Hispanics outside of the United States, not to the demographic group that will ultimately make or break the American liberty movement when Latinos become the dominant ethnic group in this country. More pro-liberty organizations, then, must speak directly to American Hispanics, as The LIBRE Initiative does.

Fortunately, American Hispanics, who are by-and-large political independents, are receptive of the message of freedom. When I published Vida Latina, a Spanish-language entertainment newspaper distributed throughout South Carolina and Georgia, I wrote all of my editorials from a libertarian perspective. The feedback I received over the years was overwhelmingly positive. The message of freedom not only resonated clearly with first-generation Hispanics (many of whom immigrated from countries that had corrupt, oppressive central governments), but it also resonated with second and third-generation Hispanics, who were better-educated than their parents but understood that the governments of their ancestors' countries of origin were overbearing.

I shared with my American Hispanic readership a refreshing alternative to the liberal monopoly of Spanish-language media. And readers ate it up.

If more pro-liberty organizations were to open their doors to Hispanics, the liberty movement just might survive the coming demographic squeeze.

Monday, February 3, 2014

PBS's "Ask the Headhunter" Blasts Applicant Tracking Systems

PBS's "Ask the Headhunter" Blasts Applicant Tracking SystemsI recently wrote an article critical of American companies' tendencies to use applicant tracking systems to seek keywords rather than allowing candidates to demonstrate potential added value to their bottom lines. I noted that the current hiring paradigm has a failure rate of up to 50%.

Today, ambitious job seeks have scant opportunities to walk into a company and make a pitch directly to a hiring manager. The personable aspect of hiring has been replaced with buggy software programs and online psychological exams that stigmatize creativity and innovative thinking.

Clearly, the American hiring paradigm is broken. PBS's "Ask the Headhunter" Nick Corcodilos has been quite outspoken on the subject. Here's one of his most thoughtful articles:
Last week, I published the 500th edition of my weekly Ask The Headhunter Newsletter, which I started in 2002. (Check the footer of this column if you'd like to subscribe. It's free.) Why does the newsletter keep going? Because America's employment system still doesn't work, and employers are clueless about why.
The emperor still has no clothes, and that's a big part of why over 25 million Americans are unemployed or under-employed. (According to the Business Desk, that's how many Americans say they want but can't find a full-time job.) Meanwhile, according to the U.S. Department of Labor, 3.9 million jobs were vacant in September.
HR executives have a special term for this 6:1 market advantage when they're trying to fill jobs today: They call it a "talent shortage."

Gimme a break.

Human resources executives run around in their corporate offices with their eyes closed, throwing billions of dollars at applicant tracking systems (ATSes) and job boards like Taleo, Monster.com and LinkedIn, and they pretend no one can see they are dancing in circles buck naked. HR keeps talking about a talent shortage, but the only talent shortage is in the HR offices. HR executives need to learn how to match up the 3.9 million vacancies with some of the 25 million under-employed.
What's going on?
The economy is certainly one factor, but businesses, the media and the federal government continue to ignore the structural problems in our employment system. I'll tell you what I think the main problems are.

Companies Don't Hire Anymore

Employers don't do their own hiring, and that's the number one problem. They outsource their competitive edge (recruiting and hiring) to third parties like Taleo, Kenexa, LinkedIn, Monster.com and CareerBuilder. Monster and LinkedIn alone sucked almost $2 billion out of the employment system in 2012. These vendors offer little more than trivial technologies and cheap string-search routines masquerading as "algorithms" for finding "hidden talent" and "matching people to jobs."

HR executives are spending billions on those systems, so why are almost 4 million jobs vacant? Because these vendors sell databases -- not recruiting, not headhunting, not jobs, not hires and not matchmaking.

Somewhere, right now, the chairman of the board of some corporation is pounding the podium at a shareholders' meeting, exclaiming, "People are our most important asset!"

Meanwhile, HR executives are funding programs that mingle their companies' most important assets in databases shared with all their competitors via a handful of applicant tracking systems that can't get the job done.

Heads-up to boards of directors: Where is your competitive edge? Take control of your hiring again, like it matters!

Employers Don't Know How to Recruit

Here's how human resources departments across America "recruit." They put impossible mixes of keywords about jobs into a computer. They press a button and pay billions of dollars for a chance that Prince Charming will materialize on their computer displays. When the prince fails to appear, they double their bets and keep gambling. (Last year, companies polled said just 1.3 percent of their hires came from Monster.com and 1.2 percent from CareerBuilder. See "Is LinkedIn Cheating Employers and Job Seekers Alike?")

Meanwhile, in the real world, over 25 million people, many of them immensely talented and capable of quickly learning how to do new jobs, are ready to work.

Employers need to get away from their desks, remove the ATS straps from around their necks, and go outside to actually find, meet, recruit, cajole, seduce and convince good workers to come work for them.
The Employment System Vendors Are Lying

The big job boards and the ATSes tell employers that sophisticated database technology will find the perfect hire.
  • "Don't settle for teaching a good worker anything about doing a job. Hire only the perfect fit!"
  • "We make that possible when you use more keywords for a job!"
  • "The database handles it all!"
When matches fail to appear, these vendors blame "the talent shortage" and contend that job seekers lack the specific skills employers need.

Except that's a lie. Job descriptions heavily larded with keywords make it virtually impossible to find acceptable candidates. Wharton researcher Peter Cappelli tells about an employer that got 25,000 applicants for a routine engineering position. The ATS rejected every single one of them. Every day that an impossible job requisition remains unfilled, the employment system vendors make more money while companies keep advertising for the perfect hires.

Millions of jobs are vacant, thanks to the empty promises of algorithms. Ignoring the role of the systems behind this failure is a costly mistake.

If the U.S. Congress wants answers about the jobs crisis, it should launch an investigation into the workings of America's employment system infrastructure, which is effectively controlled by a handful of companies.

Employers Have No Business Plan

Employers claim job applicants lack the requisite skills and talents for today's jobs. But in "Why Good People Can't Get Jobs," Peter Cappelli reports that they are wrong. The quality of the American worker pool has not diminished. Rather, American companies:
  • Don't want to pay market value to hire the right workers.
  • Don't want to train talented workers to do a new job.
  • Are content to keep using ATSes that don't get the job done.
Cappelli points out that employers believe they save money when they leave jobs vacant because their accounting systems track the cost of having workers on the payroll, but they fail to track the cost of leaving work undone. Employers run the numbers, and they seem to come up with junk profitability: Fewer Employees = Lower Costs = Higher Profits.

Employers who believe this are misguided or downright foolish. They should stop regarding workers as a cost, start treating them as investments and ensure that each worker pays off in higher profits.
Employers should get a business plan and make their employment systems accountable.

America Counts Jobs, Not Profitable Work

The federal government tracks the number of people who have jobs and the number of vacant jobs. But tallying jobs to assess the economy is like counting chickens before they hatch. The federal government has no idea which jobs or which work is actually profitable and contributing to a healthy economy.

It's no secret that the weekly employment figures are questionable and misleading. The definitions of jobs and "who is employed" are so manipulated that no one knows what is going on.
It's time to re-think how companies find and pay people to do work that produces profit. A better indicator of economic success would be the measure of how profitable all the work in America actually is -- and how much profit is left behind on the table each month when work is left undone.
People Must Stop Begging for Jobs

It's time for people to stop thinking about jobs, and high time to start thinking about how -- and where -- they can create profit.

For example, if I run a company, I'll hire you to do work -- if it pays off more than what I pay you to do it. Today, few employers know which jobs actually pay off. That's why you need to know how to walk into a manager's office and demonstrate, hands down, how you will contribute profit to the manager's business. That's right: Be smarter than the manager about his own business. Stop begging for jobs. Start offering profit.

If you can't do that, you have no business applying for any job, in any company. In the book "Fearless Job Hunting: The Interview -- Be The Profitable Hire" (available in the Ask The Headhunter Bookstore), I explain it like this:
A good employer wants to see what you can do. If he doesn't ask, help him out and show him. It'll turn your interview into a working meeting where you both roll up your sleeves, and during which the employer can do a direct assessment of your worth to his business. Here's how to say it:
"Please lay out a live problem you'd want me to handle if you hired me. I'll do my best to show you how I'd do the work so it will pay off for both of us."
Think you can generate lots of profit without working for someone else? Then bet your future on your plan, and start your own business.

What Is Going On

Here's the simple truth: Unemployment is made in America by employers who have given up control over their competitive edge -- recruiting and hiring -- to a handful of database jockeys who are funded by HR executives, who in turn have no idea how to recruit or hire themselves.
American ingenuity starts with the individual who has an idea, blossoms with a plan that will produce profit -- for yourself and your boss and your customer -- and results in more money for everybody.
So to be truly competitive, American employers must themselves do the hard work of identifying, attracting, recruiting, hiring and further training workers who can ride a fast learning curve without falling off. Outsourcing these critical tasks dulls a company's competitive edge.
Business leaders, the media and the government must revisit their assumptions that automated employment systems are the answer and that the problem is with American workers. Until the structural problems with these systems are addressed, those 3.9 million vacant jobs point to the harsh truth that American employers are a leading cause of unemployment.
"Unemployment is made in America by employers who have given up control over their competitive edge -- recruiting and hiring -- to a handful of database jockeys who are funded by HR executives, who in turn have no idea how to recruit or hire themselves." I couldn't have said it better myself. The American hiring paradigm is broken indeed.

Author's note: The comments disappeared for some reason, so I'm adding them back manually. The time stamps don't represent when the comments were posted.

Tuesday, January 28, 2014

The Student Debt Crisis: Meet The Monster

The Student Debt Crisis: Meet The Monster
Washington has shown little concern about the destructive potential of its next economy-crushing monster, America's ballooning student debt burden. Although the financial crisis should have taught the feds a thing or two about the perils of indiscriminate lending, Washington continues to invigorate its latest Frankenstein by lending to nearly any aspiring student for nearly any degree program (continuing to drive-up the cost of tuition in the process). And Uncle Sam has a perverse incentive to continue his reckless lending policies: he's pocketing tens of billions of dollars annually from financially-strapped student loan holders.

But the feds better start considering the potential economic fury of their latest monster. Nearly half (41%) of student loan holders have been behind on their payments over the last 5 years, and, last year, a full 12% of borrowers were in outright default on their student loans. At the current rate of growth, the student loan default rate will eclipse the historic maximum default rate for home loans, 14%, by mid-2015.

The mortgage crisis, of course, put us in this terrible economic condition in the first place.

As a testament to the insufficiency of this seemingly-endless economic "recovery", the rate of default on student loans has grown steadily since the 2009 economic bottom, even as the default rates on other types of loans have begun to decline. (Article continues after chart.)

The Student Debt Crisis: Meet The Monster - studen loan default rate chart

Here are some more unsettling facts about the student debt monster from Kyle McCarthy, contributor to the Huffington Post's college section:
Seven Million Defaulted:

Out of the nearly 40 million borrowers, about seven million have defaulted on these student debts. Translation: 7 million (or about 2 percent of the population of the United States) have had their credit trashed as a result of their student loans and can have 25 percent in penalties added onto their total student loan debts. To add insult to injury, about 60 percent of employers run credit checks on applicants before hiring or promoting, making it close to impossible for millions to get a higher paying job to actually repay these debts.

Average Student Debt Increases While Wages Decrease:

Since 1999, student debt has increased more than 500 percent. Unfortunately, average salaries for young people have not. In fact, since 2000, the average salary for young people has decreased by 10 percent. It's no wonder that we are seeing millennials delaying starting families, making car purchases and buying homes.
Delayed life milestones create opportunity costs for the economy.

According to the non-profit American Student Assistance, the origin of student borrowers' repayment difficulties has been the persistently-high unemployment and underemployment caused by the Fed and the federal government's last monster, the housing bubble.

Central banks and central governments never learn.

As a side note, a buddy of mine recently asked me why student loans aren't dischargeable by bankruptcy like other kinds of loans. I told him that it's because indebted students--unlike investment bankers--have little lobbying power in Dr. Frankenstein's laboratory on the Potomac.

Wednesday, January 22, 2014

State Marijuana Legalization Approaching Critical Mass

State Marijuana Legalization Approaching Critical MassThe push to legalize marijuana at the state level has been spreading like wildfire. In the course of 2 years, 20 states and the District of Columbia have legalized cannabis for medicinal use, and 2 states have legalized it for recreational use. Here's what the scoreboard looks like as of today:

State Marijuana Legalization Approaching Critical Mass - legalization map

There's a "high" probability that, this year, 2 of the light-green states on the preceding map (Oregon and Alaska) will turn dark green as state legislatures in the Beaver State and The Last Frontier approve possession of cannabis for recreational use. Outright legalization in 2014 is also a possibility in Maine, Vermont, New Hampshire, Rhode Island and Massachusetts. Additionally, 6 states (Kentucky, Ohio, Minnesota, Pennsylvania, New York, and Tennessee) will consider bills this year to legalize medical marijuana. And get this: this year, even Alabama will consider a bill to decriminalize!

It's possible that, by year's end, more than half of the states will have either legalized or decriminalized marijuana.

As "purple" and "red" states start to embrace legalization or decriminalization, the building momentum will become unstoppable. At that point, Washington will have no choice to but to anger its Big Pharma masters--who spend big bucks to lobby Uncle Sam to keep marijuana illegal--and consider legalization on a federal level.

That, my friends, will be a huge blow to crony capitalism and spell the beginning of the end for the War on Drugs.

Tuesday, January 21, 2014

Crony Capitalism In My Backyard

Crony Capitalism In My BackyardI live on James Island, a middle class suburb of Charleston, SC that the city has been busily annexing little by little over the past few decades. Many James Islanders strongly oppose annexation because the City of Charleston is a municipality of high taxes and burdensome regulations. Case in point: it's illegal in the city to give historic tours without an expensive license from municipal government. And get this: the Charleston Police Department spends valuable resources pursuing "unauthorized" tour guides! And it's not like the CPD doesn't have enough to do: the City of Charleston has a fairly high crime rate.

From the Post and Courier:
It was a Charleston police sting unlike any other: An undercover cop dressed casually like a tourist taking a ride on a rickshaw.

The goal was to see if any of the downtown drivers were giving illegal speaking tours of the city's numerous sight-seeing spots.
One of them did, and it cost him a fine of more than $1,000.
City officials have put rickshaw drivers on notice that they can't give unlicensed tours in pursuit of a few extra dollars in their pocket.

As far as police see it, any retelling for hire about the city's past can be delivered only by a city-licensed tour guide, like those generally seen driving horse carriages or leading walking tours.
Charleston Police Sgt. Heath King said the sting was arranged after South of Broad residents complained that workers at the city's three rickshaw companies were giving unsanctioned rides through downtown neighborhoods.

The tours stood out for two reasons - the drivers were giving history lessons, and were also seen doing "laps" on the Battery with the same customers.

Both are against the rules for rickshaws, which are considered more like taxis for "Point A-to-Point B" trips, King said.

For the sting, which took place in September but came to light only recently, police officers went on two rides offered by each of the three rickshaw companies operating in the city (six rides total) - "to make it fair," King said.

The officers' dress was casual; mostly golf shirts and jeans.

"I didn't have them wear 'I love Charleston' T-shirts," King said of the disguises.
Of the six rides taken, only one of the drivers made the tour offer, King said.

Rickshaw driver David Criscitiello of Charleston Rickshaw said the tour involved his being dispatched to a downtown restaurant to pick up a female rider. He took her to the Battery, where along the way he talked about the city's sites and history points, even showing off Fort Sumter.
"As far I'm concerned we are not tour guides," Criscitiello said. "But I know where the pretty places are in town."

When the ride ended about 30 minutes later, Criscitiello was approached by another officer and given a $1,092 "touring prohibited" ticket. The discussion between the undercover officer and the rickshaw driver during the ride was recorded with a hidden device.

Perhaps no other city regulates tourism more strictly than Charleston, which issued its first tour license in 1952. To be approved as a recognized tour guide, it requires taking an exam and studying a nearly 500-page "City of Charleston Tour Guide Training Manual" covering hundreds of houses, churches and other significant buildings.

City officials contend that the crackdown was needed because allowing unregulated tours, even by casual method, would create gridlock and other problems as slower-moving vehicles could bring streets to a standstill when stories get told.

"Rickshaws are not part of that," King said. The number of complaints has decreased since the sting, he added.

Criscitiello said he is paying off his fine in installments after pleading guilty in municipal court.
One could make the case that the City of Charleston requires tour guides to be licensed to ensure that the history being taught is accurate. Thing is, history is written from the perspective of the "winners", whose accounts may or may not be accurate. It's not a coincidence that embarrassments to the federal government such as Reconstruction, the New York Draft Riots, the Bonus Army Massacre, the Massacre at Wounded Knee, etc. are either whitewashed or are completely omitted from American history books. So, who's to say that the "official" Charleston story is accurate? The city government, which makes its revenue from tourist dollars?! Come on.

No, Charleston's tour guide license requirement is all about protecting "Big Tourism", the city's handful of sightseeing companies that make money hand-over-fist. Just like New York City's ONE MILLION DOLLAR taxi license is all about protecting "Big Transportation" in the Big Apple. Crony capitalism, plain and simple. Screw the little guy.

Thursday, January 16, 2014

The War On Poverty: A War On Social Mobility

The War On Poverty: A War On Social MobilityThe federal government's "War on Poverty" has been an abject failure. The poverty rate is higher than it was before the "war" was started in earnest in the late 1960s and has been trending inexorably upward since the Fed started its "bubble/bust" cycle in the late 1990s.


The War On Poverty: A War On Social Mobility - poverty rate chart

Before the implementation of LBJ's war, the poverty rate had been falling precipitously during the post-WWII economic expansion. You can better see that decline on this chart, which tracks the poverty rate back to 1950:

The War On Poverty: A War On Social Mobility - poverty rate back to 1950 chart

As you can see, the free market was doing a pretty good job of pulling Americans out of poverty until Uncle Sam interjected. Since that time, the poverty rate has been stuck in a narrow corridor, hitting a post-war peak last year, which you can see in the first chart.

But how can this be? How can the poverty rate be higher when the federal government has spent more than $15 trillion over the last 50 years combating poverty? Well, for one thing, since the War on Poverty, the federal government has made it policy to pay the poor to have illegitimate children. As a result, the percentage of American children born out of wedlock has skyrocketed.

The War On Poverty: A War On Social Mobility - children born to married parents chart

I'm no social conservative, but I recognize that broken homes contribute to low social mobility. And unwed mothers having illegitimate children for cash from the government absolutely create broken homes.

Wednesday, January 15, 2014

Depression Year 6: More Americans Worse Off Financially

Depression Year 6: More Americans Worse Off FinanciallyGallup reports that more Americans are worse off financially than a year ago. This revelation--five and a half years after the fall of Lehman--is just the latest evidence that the economic depression continues. (Article continues after chart.)

Depression Year 6: More Americans Worse Off Financially - change in financial situation

For years, I've been calling this period of American history an economic depression. Before calling me a Chicken Little for using the "d" word, please keep in mind that there is no official definition for "depression" in an economic sense. Most economists, however, refer to protracted periods of economic malaise as depressions. And the last 6 years have absolutely been a protracted period of economic malaise.

Years after the economy bottomed in 2009, the epidemic of long-term unemployment and underemployment continues to afflict the American workforce. Five years into "recovery", fewer jobs were created last year than the year before. And, as has been the case throughout this economic depression, the vast majority of jobs created last year were menial in nature. Very few new "breadwinner" jobs.

Obamacare has undoubtedly contributed to the continuation of our current economic depression. It has increased health insurance premiums by an average of 41%, discouraged hiring and business expansion, and caused millions of Americans to lose their healthcare plans entirely. Obamacare has proven an excellent saboteur of economic recovery.

Keep in mind that the unacceptably tepid recovery that we do have is a result of the inflation of the Fed's latest asset bubble. The Fed's balance sheet just passed $4 trillion. That's 22% of the entire economy. The Fed is inflating what Nouriel Roubini is calling the "mother of all bubbles". Much larger than the bubble that burst and led to this economic depression. And this bubble, unlike the last one, comes with high overall price inflation.

Friday, January 10, 2014

More Bureau Of Labor Statistics Data Manipulation

More Bureau Of Labor Statistics Data Manipulation
I predicted last month that the Bureau of Labor Statistics would remove from the workforce many of the 1.3 million Americans who lost their unemployment benefits this month. As a result, I said, the "headline" unemployment rate would drop precipitously. And that's exactly what happened. According to the BLS, 5 people left the workforce for every job added last month. And yet, the unemployment rate fell from 7% to 6.7%. Yeah, right.

There are lies and damn lies, and then there's the Bureau of Labor Statistics. (Which, I'll remind you again, is under investigation for data manipulation.) According to Zero Hedge, here's what the "headline" unemployment rate would look like if the BLS used the 30-year average labor force participation rate (as opposed to its current 1970s rate). Keep in mind that this chart DOESN'T COUNT the tens of millions of UNDERemployed Americans. Lest we forget, a woefully insufficient number of breadwinner jobs have been created since the economy crashed.

More Bureau Of Labor Statistics Data Manipulation - real unemployment rate

So, the real headline unemployment rate is more likely hovering between 11 and 12 percent. And, again, that doesn't count the tens of millions of UNDERemployed. Gallup pegs the underemployment rate at 17.2%. Recalculating the underemployment rate using the 30-year average labor force participation rate, we get a number closer to 20%.

With charts like this next one, do you really believe that the unemployment rate has dropped from 10 to 6 percent over the last few years?

More Bureau Of Labor Statistics Data Manipulation - mean duration of unemployment

Monday, January 6, 2014

Victories For States' Rights

Victories For States' Rights
For generations, the federal government has been sucking more and more resources from the private sector and usurping more and more personal liberties. Contrary to popular belief, the rate of growth of the federal government has been fairly consistent regardless of the party in control. The insanity coming out of Washington has unstoppable inertia.

Fortunately, many states are taking matters into their own hands. 2013 saw significant victories for states' rights:
  • Several states thumbed their noses at Washington's War on Drugs by decriminalizing--or, in the case of Colorado and Washington--outright legalizing the possession of marijuana. Other states are now considering outright legalization.
  • Governors of several states stated that they wouldn't comply with additional gun control measures following Sandy Hook. Several sheriffs also went on record stating that they wouldn't comply. (I interviewed one of those sheriffs, Sheriff Al Cannon of Charleston County, SC, on an episode of ECOMINOES Radio.)
Hopefully, 2014 will see even more victories for states' rights. Because "throwing the bums out" certainly hasn't worked.

Monday, December 30, 2013

Latest Evidence That Gov Unemployment Data Are Junk

Latest Evidence That Gov Unemployment Data Are JunkI've stated many times that government unemployment data aren't to be trusted. The Bureau of Labor Statistics, which is under investigation for data manipulation, has published statistically-impossible rosy jobs reports, and, even when it has reported realistic numbers, has taken the data out of context by failing to report the low quality of jobs created. Government unemployment data, which almost always show an improving employment situation, haven't represented the true sad state of the labor market in years.

The latest evidence that government unemployment data are junk: Last month's jobs report, which the mainstream media, the Obama administration, and the stock market celebrated as evidence of a strong economic recovery, may have omitted data from the nation's 4th most populous state, Florida. Oops. As it turns out, according to the Miami Herald, hundreds of thousands of Floridians may have been omitted from the government's November unemployment count. Put away the champagne.

Wait for the smoke-and-mirrors likely to come out of the Labor Department next month:

The government is expected to remove a large number of Americans from the workforce count next month, as 1.3 million Americans will lose their unemployment benefits at year's end. The last time over 1 million Amweicans lost their benefits at once, July of 2010, the BLS crushed down the labor force participation rate from 66% to 64.5%, as you can see on the following chart. Watch as the BLS magically lowers the unemployment headline number next month by crushing down the labor force participation rate to 1970s levels, when few households sent more than one member into the workforce.

Latest Evidence That Gov Unemployment Data Are Junk - Labor Force Participation Rate Chart

Have a wonderful free-market New Year! See you soon.

Saturday, December 28, 2013

Hey SC: Small Business, Not Big Business, For Job Creation

Hey SC: Small Business, Not Big Business, For Job CreationThe other day, I wrote a letter to the editor of my local newspaper, the Post and Courier (Charleston, SC), in regards to a letter from a prominent local Republican who criticized the paper for not covering a recent event at which Governor Nikki Haley spoke. At the event, according to the letter writer, our self-described "jobs, jobs, jobs" governor boasted about overseeing the creation of thousands of jobs during her tenure. I had reservations with the letter writer's claim that good jobs have been created on Governor Haley's watch:
On Christmas day, the Post and Courier published a letter from a local civil servant who criticized your newspaper for failing to cover a luncheon in which Governor Nikki Haley touted the growth of new jobs in South Carolina. According to this person, Governor Hailey proudly announced the creation of menial employment in this state such as tire factory jobs and electronic assembly line jobs. While I agree with the letter writer that the P&C often fails to cover Lowcountry political and civic events, I disagree with him that the creation of menial jobs is something our state should be proud of.
On my economics and politics blog, I often talk about the continuous replacement of so-called "breadwinner jobs" with menial and part-time employment. This trend began during the Great Recession and has been accelerated with the advent of Obamacare. Governor Hailey's proud speech about the creation of menial jobs and the civil servant's report that it "uplifted the room" suggest that the political class is out-of-touch with economic reality.
In my letter, I attempted to convey the primary points I've been trying to impress upon ECOMINOES readers since my first post nearly 2 years ago: 1) The majority of jobs created since the Great Recession have been of low quality, and it matters little how many new menial jobs a state creates via crony relationships with Big Business. 2) No amount of new menial jobs will enable economic recovery for the tens of millions of Americans who lost their financial standing during the recession.

State legislatures from all over the country have been giving away generous perks to Big Business in order to convince huge companies to relocate to--or expand in--their states. (At the expense of small businesses. SC's Amazon deal, for example, harmed local retailers.) And look at the results: factory jobs. Woefully insufficient for economic recovery, much less economic expansion.

This is 2013 going on 2014, not 1943 going on 1944. By and large, factory jobs haven't been "breadwinner jobs" in generations. The Perks-To-Big Business strategy will bring a state 1940s jobs with 1940s pay, but it won't bring it good jobs. Detroit has been trying Perks-To-Big Business strategy for decades. And look what an economic basket case that city is. The PTBB strategy simply doesn't work.

Facilitating the development of small-businesses, on the other hand, does.

Promoting the creation and growth of small businesses is far more effective at creating good jobs than giving away perks to Big Business. States that have promoted job creation via small business facilitation have the strongest economies and the best jobs. Texas is perhaps the best example. Texas has had one of the strongest economies and one of the lowest unemployment rates since the U.S. economy crashed in 2008. Why? Because, according to Motley Fool, 4 of the 10 best cities in which to start a business are located in the Lone Star State. Texas promotes jobs growth by facilitating small business creation and growth via low taxes (including zero income tax...hint, hint, SC) and limited regulations. Not by giving away perks to Big Business at the expense of small businesses.

There's your formula for success. Small business, not Big Business. If Governor Haley really wants to be a "jobs, jobs, jobs" governor, she should talk with Rick Perry.