Saturday, September 10, 2011
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Obama's jobs speech
Obama's jobs speech
A call to action
AS JOB growth has ground to a halt and stock markets have swooned, the outlook for both the American economy and Barack Obama’s presidency has dimmed. The jobs package he unveiled in a much anticipated speech before Congress on September 8th was a calculated attempt to resuscitate both. His “American Jobs Act” consists of a hefty $447 billion worth (roughly 3% of GDP) of new and renewed tax cuts and spending that, he hopes, will prevent a fiscal vice from pushing the economy into recession early next year. Its provisions were carefully chosen to stimulate job growth immediately while maximising the political price Republicans will pay to obstruct it.
Mr Obama proposed not only extending a 2% payroll-tax cut scheduled to expire in December, but increasing it to 3.1%—half the employee’s normal contribution to Social Security. He also called for an equivalent 3.1% cut in the employer’s payroll tax for the first $5m of payroll, and elimination of the entire 6.2% tax on the wages of new hires or on pay raises for current employees. At $240 billion, those provisions account for more than half the plan’s price tag.He also wants to keep extended unemployment insurance benefits rather than let them expire in December while offering states flexibility to use the plan to encourage the unemployed to return to work. That could involve work sharing, which Germany used effectively to spread the decline in economic output across working hours rather than head count; letting the unemployed collect benefits while training or doing volunteer work; and wage insurance, which subsidises the wages of people whose new job pays less than their old. That would be a welcome shift for America’s safety net which spends too much on income support and too little reintegrating the jobless into the labour market. Still, the sums are small relative to the scope of the problem.
At $140 billion the bulk of the remaining money would be funnelled into public works and state aid. Mr Obama would send $25 billion to state and local governments to refurbish 35,000 schools and $35 billion to keep teachers, police and firefighters employed. Another $50 billion would go to immediate investments in highways and public transport, and $10 billion for an infrastructure bank that would try to leverage private capital for public works. While such spending has a relatively high impact on the economy, it has proven difficult to find projects that are both “shovel-ready” and worth doing.
Prevention of a double-dip into recession is the president's priority. In February, his budget office predicted the economy would grow by 3% this year. Serial disappointments forced the White House to downgrade that to just 1.6% last month. Meanwhile, the fading impact of his original $825 billion stimulus and the expiration of $200 billion more in support added last December threaten to knock 2% from gross domestic product next year. Furthermore, tax collections have risen more than expected this year, which represents a further unanticipated fiscal tightening. Unaddressed, those factors could move the economy into recession, if it isn’t there already. A senior administration official predicted that Mr Obama’s plan, if fully enacted, would result in fiscal policy being roughly neutral, rather than a drag, next year.
The president sought to make it as difficult as possible for Republicans to obstruct his plans by ensuring each of his proposals had some Republican parentage. For example, the infrastructure bank is modelled on a measure proposed by John Kerry and Kay Bailey Hutchison, Democratic and Republican senators respectively. The US Chamber of Commerce, a fierce opponent of much of Mr Obama’s agenda, has been a vocal advocate of more infrastructure spending. The use of unemployment benefits to retrain the jobless is based on a Georgia programme that Republicans have praised.
Nonetheless, there are limits on Mr Obama’s appetite and freedom to compromise. His liberal backers threatened to desert him as he repeatedly caved in to Republicans, extending George Bush’s tax cuts for the wealthy, agreeing to steep spending cuts in return for an increase in the debt ceiling, and just last week delaying new smog rules. His language and tone tonight were combative, at times hectoring. Noting how many Republicans have pledged never to raise taxes, he said, “Now is not the time to carve out an exception and raise middle class taxes. Which is why you should pass this bill right away.”
Republicans have branded Mr Obama’s previous stimulus a failure and have little vested interest in passing anything that helps him get re-elected. However, their calculus may be shifting. Congress’ approval ratings have fallen further than Mr Obama’s. Republicans paid a price for dragging the country to the brink of default in August in an effort to force Mr Obama to accept bigger spending cuts. A Wall Street Journal/NBC poll found voters blame Republicans more than Mr Obama for Standard & Poor’s subsequent decision to downgrade the country’s credit rating. This means they cannot afford to appear obstructionist, and indeed in recent days have begun sounding more conciliatory, promising to seek common ground with Mr Obama. John Boehner, speaker in the House of Representatives, politely said that Mr Obama’s ideas “merit consideration”.
This, however, is a far cry from support. The most contentious element may be how to pay for the plan. Mr Obama promises it will not add to the deficit. Rather than specify offsetting spending cuts or tax increases, though, he proposed that Congress’s “super committee”, created under last month’s debt ceiling deal, come up with the money. Under that deal, a bipartisan committee has until November 23rd to find up to $1.5 trillion in deficit reductions over the coming decade to add to the roughly $900 billion in spending cuts already enacted under the debt deal. Congress then has until December 23rd to pass them. If they fail, then automatic spending cuts of $1.2 trillion kick in. Mr Obama proposed amending the deal to increase both the committee’s target and the automatic triggers by the same amount as the stimulus.
The committee’s task of finding common ground among its Democratic and Republican members is hard enough. After its first meeting, the morning before Mr Obama’s speech, John Kyl, a Republican senator, threatened to quit if defence spending were touched. Jeb Hensarling, the panel’s Republican co-chairman, said Mr Obama's plan makes the “already arduous challenge of finding bipartisan agreement on deficit reduction nearly impossible”.
Most likely, Republicans will cherry pick and pass the parts they like, such as free-trade deals. Administration officials put the odds of passing the proposed tax cuts at better than 50% but are less confident on the spending provisions.
Mr Obama said that he will send more comprehensive ideas on tax and entitlement reform, including tweaks to Medicare, to the super committee in coming days. They will produce, he said, a primary budget surplus (that is, excluding interest payments). That’s not as ambitious as it sounds: his latest budget already envisions a primary surplus by 2017. That, of course, relies on the scheduled expiration of tax cuts on the rich and elimination of some corporate tax breaks, which Republicans seem likely to reject. Mr Obama reiterated his intent to press for higher taxes, averring, “This is not class warfare, this is simple math.” He was met by disbelieving murmurs. Nonetheless, the super committee may be the last chance before 2013 for Mr Obama and Republicans to reach some kind of grand bargain that cuts the deficit by reforming both taxes and entitlements. The panel’s proposal can’t be amended or filibustered in the senate, so it is uniquely suited for something so ambitious and contentious.
Throughout his speech Mr Obama tried to impress a sense of urgency upon his listeners. “Some of you have decided that our differences are so great that we can only resolve them at the ballot box. But the next election is 14 months away. The people who sent us here … don’t have the luxury of waiting 14 months.” But the odds that Mr Obama and Republicans can overcome their gaping differences in less than three months seem long indeed.
Angst for the educated
Angst for the educated
MILLIONS of school-leavers in the rich world are about to bid a tearful goodbye to their parents and start a new life at university. Some are inspired by a pure love of learning. But most also believe that spending three or four years at university—and accumulating huge debts in the process—will boost their chances of landing a well-paid and secure job.
Their elders have always told them that education is the best way to equip themselves to thrive in a globalised world. Blue-collar workers will see their jobs offshored and automated, the familiar argument goes. School dropouts will have to cope with a life of cash-strapped insecurity. But the graduate elite will have the world at its feet. There is some evidence to support this view. A recent study from Georgetown University’s Centre on Education and the Workforce argues that “obtaining a post-secondary credential is almost always worth it.” Educational qualifications are tightly correlated with earnings: an American with a professional degree can expect to pocket $3.6m over a lifetime; one with merely a high-school diploma can expect only $1.3m. The gap between more- and less-educated earners may be widening. A study in 2002 found that someone with a bachelor’s degree could expect to earn 75% more over a lifetime than someone with only a high-school diploma. Today the premium is even higher.
But is the past a reliable guide to the future? Or are we at the beginning of a new phase in the relationship between jobs and education? There are good reasons for thinking that old patterns are about to change—and that the current recession-driven downturn in the demand for Western graduates will morph into something structural. The gale of creative destruction that has shaken so many blue-collar workers over the past few decades is beginning to shake the cognitive elite as well.
The supply of university graduates is increasing rapidly. The Chronicle of Higher Education calculates that between 1990 and 2007 the number of students going to university increased by 22% in North America, 74% in Europe, 144% in Latin America and 203% in Asia. In 2007 150m people attended university around the world, including 70m in Asia. Emerging economies—especially China—are pouring resources into building universities that can compete with the elite of America and Europe. They are also producing professional-services firms such as Tata Consulting Services and Infosys that take fresh graduates and turn them into world-class computer programmers and consultants. The best and the brightest of the rich world must increasingly compete with the best and the brightest from poorer countries who are willing to work harder for less money.
At the same time, the demand for educated labour is being reconfigured by technology, in much the same way that the demand for agricultural labour was reconfigured in the 19th century and that for factory labour in the 20th. Computers can not only perform repetitive mental tasks much faster than human beings. They can also empower amateurs to do what professionals once did: why hire a flesh-and-blood accountant to complete your tax return when Turbotax (a software package) will do the job at a fraction of the cost? And the variety of jobs that computers can do is multiplying as programmers teach them to deal with tone and linguistic ambiguity.
Several economists, including Paul Krugman, have begun to argue that post-industrial societies will be characterised not by a relentless rise in demand for the educated but by a great “hollowing out”, as mid-level jobs are destroyed by smart machines and high-level job growth slows. David Autor, of the Massachusetts Institute of Technology (MIT), points out that the main effect of automation in the computer era is not that it destroys blue-collar jobs but that it destroys any job that can be reduced to a routine. Alan Blinder, of Princeton University, argues that the jobs graduates have traditionally performed are if anything more “offshorable” than low-wage ones. A plumber or lorry-driver’s job cannot be outsourced to India. A computer programmer’s can.
A university education is still a prerequisite for entering some of the great guilds, such as medicine, law and academia, that provide secure and well-paying jobs. Over the 20th century these guilds did a wonderful job of raising barriers to entry—sometimes for good reasons (nobody wants to be operated on by a barber) and sometimes for self-interested ones. But these guilds are beginning to buckle. Newspapers are fighting a losing battle with the blogosphere. Universities are replacing tenure-track professors with non-tenured staff. Law firms are contracting out routine work such as “discovery” (digging up documents relevant to a lawsuit) to computerised-search specialists such as Blackstone Discovery. Even doctors are threatened, as patients find advice online and treatment in Walmart’s new health centres.
Dreaming spires, meet pin factory
Thomas Malone of MIT argues that these changes—automation, globalisation and deregulation—may be part of a bigger change: the application of the division of labour to brain-work. Just as Adam Smith’s factory managers broke the production of pins into 18 components, so companies are increasingly breaking the production of brain-work into ever tinier slices. TopCoder chops up IT projects into bite-sized chunks and then serves them up to a worldwide workforce of freelance coders.
These changes will undoubtedly improve the productivity of brain-workers. They will allow consumers to sidestep the professional guilds that have extracted high rents for their services. And they will empower many brain-workers to focus on what they are best at and contract out more tedious tasks to others. But the reconfiguration of brain-work will also make life far less cosy and predictable for the next generation of graduates.
MILLIONS of school-leavers in the rich world are about to bid a tearful goodbye to their parents and start a new life at university. Some are inspired by a pure love of learning. But most also believe that spending three or four years at university—and accumulating huge debts in the process—will boost their chances of landing a well-paid and secure job.
Their elders have always told them that education is the best way to equip themselves to thrive in a globalised world. Blue-collar workers will see their jobs offshored and automated, the familiar argument goes. School dropouts will have to cope with a life of cash-strapped insecurity. But the graduate elite will have the world at its feet. There is some evidence to support this view. A recent study from Georgetown University’s Centre on Education and the Workforce argues that “obtaining a post-secondary credential is almost always worth it.” Educational qualifications are tightly correlated with earnings: an American with a professional degree can expect to pocket $3.6m over a lifetime; one with merely a high-school diploma can expect only $1.3m. The gap between more- and less-educated earners may be widening. A study in 2002 found that someone with a bachelor’s degree could expect to earn 75% more over a lifetime than someone with only a high-school diploma. Today the premium is even higher.
But is the past a reliable guide to the future? Or are we at the beginning of a new phase in the relationship between jobs and education? There are good reasons for thinking that old patterns are about to change—and that the current recession-driven downturn in the demand for Western graduates will morph into something structural. The gale of creative destruction that has shaken so many blue-collar workers over the past few decades is beginning to shake the cognitive elite as well.
The supply of university graduates is increasing rapidly. The Chronicle of Higher Education calculates that between 1990 and 2007 the number of students going to university increased by 22% in North America, 74% in Europe, 144% in Latin America and 203% in Asia. In 2007 150m people attended university around the world, including 70m in Asia. Emerging economies—especially China—are pouring resources into building universities that can compete with the elite of America and Europe. They are also producing professional-services firms such as Tata Consulting Services and Infosys that take fresh graduates and turn them into world-class computer programmers and consultants. The best and the brightest of the rich world must increasingly compete with the best and the brightest from poorer countries who are willing to work harder for less money.
At the same time, the demand for educated labour is being reconfigured by technology, in much the same way that the demand for agricultural labour was reconfigured in the 19th century and that for factory labour in the 20th. Computers can not only perform repetitive mental tasks much faster than human beings. They can also empower amateurs to do what professionals once did: why hire a flesh-and-blood accountant to complete your tax return when Turbotax (a software package) will do the job at a fraction of the cost? And the variety of jobs that computers can do is multiplying as programmers teach them to deal with tone and linguistic ambiguity.
Several economists, including Paul Krugman, have begun to argue that post-industrial societies will be characterised not by a relentless rise in demand for the educated but by a great “hollowing out”, as mid-level jobs are destroyed by smart machines and high-level job growth slows. David Autor, of the Massachusetts Institute of Technology (MIT), points out that the main effect of automation in the computer era is not that it destroys blue-collar jobs but that it destroys any job that can be reduced to a routine. Alan Blinder, of Princeton University, argues that the jobs graduates have traditionally performed are if anything more “offshorable” than low-wage ones. A plumber or lorry-driver’s job cannot be outsourced to India. A computer programmer’s can.
A university education is still a prerequisite for entering some of the great guilds, such as medicine, law and academia, that provide secure and well-paying jobs. Over the 20th century these guilds did a wonderful job of raising barriers to entry—sometimes for good reasons (nobody wants to be operated on by a barber) and sometimes for self-interested ones. But these guilds are beginning to buckle. Newspapers are fighting a losing battle with the blogosphere. Universities are replacing tenure-track professors with non-tenured staff. Law firms are contracting out routine work such as “discovery” (digging up documents relevant to a lawsuit) to computerised-search specialists such as Blackstone Discovery. Even doctors are threatened, as patients find advice online and treatment in Walmart’s new health centres.
Dreaming spires, meet pin factory
Thomas Malone of MIT argues that these changes—automation, globalisation and deregulation—may be part of a bigger change: the application of the division of labour to brain-work. Just as Adam Smith’s factory managers broke the production of pins into 18 components, so companies are increasingly breaking the production of brain-work into ever tinier slices. TopCoder chops up IT projects into bite-sized chunks and then serves them up to a worldwide workforce of freelance coders.
These changes will undoubtedly improve the productivity of brain-workers. They will allow consumers to sidestep the professional guilds that have extracted high rents for their services. And they will empower many brain-workers to focus on what they are best at and contract out more tedious tasks to others. But the reconfiguration of brain-work will also make life far less cosy and predictable for the next generation of graduates.
Hire retail security guard to run business safely!
Hire retail security guard to run business safely!
If you want to secure your shop against increasing incidents like thefts and robberies then you must hire retail security guard either in uniform or plain clothes. Security guarding helps a retail shop owner to run his shop safely because a security guard keeps an eye on each and every activity of customers. People who are afraid of shop lifters must approach a professional guard for reducing the possibility of such incidents as far as possible.Are you afraid of shop lifters? If yes, then you must make some arrangements for the safety of your business. There are a number of professional companies which offer the services of talented and skillful security guards who keep an eye over all the activities performed by the customers as well as other workers engaged in the concerned shop.
Security guarding is a service which is offered by different professionals to safeguard the life of people along with their belongings. In present scenario, incidents like thefts and robberies on retail shops have become common and occur after every hour. In order to avoid the occurrence of such acts shopkeepers generally prefer to hire retail security guard. It depends upon the need and preferences of shopkeepers that they want to go for uniformed security guards or one who wear plain clothes.
People who prefer to hire uniformed security guard actually want visitors or customers to realize that their each and every activity is being watched over by these professionals so that they do not try to commit any kind of crime in the shop. Some people ask their guards to wear plain and casual clothes because they do not want people to know that there is somebody who can catch you while committing acts like theft and robbery. They also protect the life of shop keepers against criminals who come to take away all the precious stock, money and harm the lives of people present there.
If you are finding it difficult to approach desired security guards then you must take the help of internet facility and search over the websites of companies, engaged in offering such kind of services. People feel afraid to open their own shops due to the occurrence of crimes at a large scale so hiring the services of security guards would be beneficial for them.
So, protect your lives and shops against thefts and robberies with the help of professional security guards!
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