Robert Samuelson has an oped today with the tagline: "What to do about job creation." That looks like a declarative statement that promises bold ideas about job creation. It's not. It's more like when I get to work and wonder, "What to do, what to do about this mess of papers on my desk." That means I have no good ideas about how to clean up my desk. One might say the same about Samuelson and job creation.
Samuelson's objection to most of the ideas out there -- stimulus or tax credit -- seems to be that they cost money. That's OK, I guess. Samuelson is a deficit hawk, and we're running a historic deficit. But I would have liked him to try a little harder to debunk real ideas about job creation.
The Keynesian (after English economist John Maynard Keynes, who died in 1946) solution holds that government activism can generate more jobs. That's the theory behind the $787 billion "economic stimulus" passed in February. Many ideas are circulating for Stimulus 2.0, though the controversy over Stimulus 1.0 suggests that it will be relabeled.
Larry Mishel of the liberal Economic Policy Institute wants more aid for state governments, a further extension of unemployment insurance (now up to 79 weeks) and a tax credit for companies that create new jobs. One proposal would give employers about a $7,000 credit for each additional worker hired (over some base period). Timothy Bartik of the W.E. Upjohn Institute for Employment Research thinks such a credit might create 2 million jobs. The budgetary cost could be $40 billion or higher. One drawback: Two-thirds of the credit's cost might go to firms that would have hired anyway.
That last paragraph is a little frustrating. First he doesn't mention the better tax-cut plan, which is a payroll tax holiday. Also, Samuelson links the employer tax credit idea to a liberal think tank, but plenty of conservatives have suggested the same thing. In a sentence it's dismissed because of some phantom statistic, but the idea has bipartisan support, among both policy wonks and politicians. Maybe it will work, maybe it won't, but it certainly deserves more than a sentence of consideration. Speaking of things that deserve more than a sentence of consideration, here's his take on "what to do about job creation":
Government erects many employment obstacles: restrictions on oil and natural gas drilling; unapproved trade agreements; some regulations.
Seriously, that's the only sentence he has about his ideas for job creation. "Some regulations." The end.
I'm not saying he's wrong that changing some aspects of regulatory law might create some jobs. And it's undeniable that opening off-shore drilling will encourage some hires. But it's not going to push unemployment under eight before 2010. Samuelson's one-sentence brainstorm on how to combat 16 percent total unemployment is the public policy equivalent of watching a head-on car accident and throwing one of the drivers a IcyHot patch through the shattered window. Job creation deserves good ideas, and better critiques.
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