(ThyBlackMan.com) Let’s get busy! Please e-mail or face book this piece to a friend. For many seasons, I have written articles regarding the anticipated failure of an economic recovery using only monetary policy. I projected without equivocation that this economic recovery would fail ( https://thyblackman.com/2014/11/10/3-reasons-why-the-current-economic-recovery-will-fail/ ). African Americans need to come together and coalesce around an economic solution to create jobs and spur the economy. This needs to be done now! We are staring into the face of a new and more onerous economic downturn, as world investment markets sell-off due to a 6 ½ year slow down of manufacturing activities in China ( https://thyblackman.com/2014/01/30/easy-money-being-drawn-out-of-the-economy/ )!
The Federal Reserve Bank (Fed),our central banker, fought high “unemployment rates” caused by the Great Recession through aggressively cutting interest rates beginning in 2008. Through cutting interest rates, the Fed created an atmosphere which led to job creation based on easy money. The Fed has maintained interest rates at historic lows, near zero. Not everyone benefited equally as the Fed lowered interest rates. The larger population, Hispanics and Asians as measured worker groups, have all benefited and have low single digit unemployment rates. Nevertheless, the Bureau of Labor Statistics (BLS) states as of July, there are still officially 8.3 million Americans unemployed (unchanged from June), and 2.2 million or 26.9 percent of those are long term unemployed (those jobless for 27 weeks or more). The black unemployment rate reported by the BLS for the same period stands at 9.1 percent, almost double that of the white rate at 4.6 percent. These are awful, yet official numbers. However, it is well understood by experts who follow these numbers that the real unemployment rate is even higher, by as much as 2 to 5 percent.
African Americans will not fare well as the realities of this “new” downturn begins to kick in and take a grip! African Americans are in the unfortunate and unenviable position of being the worker group that is the first laid-off as the economy turns downward. Therefore, blacks are in a way the canaries in the mine. The Wiktionary (a dictionary of sorts) defines the canary in the mine concept the best. Its states it an allusion to caged canaries (birds) that miners would carry down into the mine tunnels with them.
If dangerous gases such as methane or carbon monoxide leaked into the mine, the gases would kill the canary before killing the miners, thus providing a warning to exit the tunnels immediately. Well, as this downturn takes a firm hold in the coming weeks and months, blacks will no doubt be affected first as a worker group because of their reputation of being the first laid-off. However, as with the miners, there will no exit for African Americans from new rounds of anticipated lay-offs due to this slow-down.
There is no question; this country needs a fiscal solution to job creation in order to avoid this coming tragedy! However, the ills of our economy have been left to the Fed to resolve using only monetary policy. Monetary policy encompasses among other things, increasing and lowering interest rates, flooding the banking system with cash by buying government bonds as the Fed did with its quantitative easing (QE) program, advising central banks in other countries to adopt QE as a means to stimulate their economies, and influencing investment markets through making timely comments about its position on interest rates. If this is the best that monetary policy can accomplish after seven years of attacking the problems of unemployment and job creation, it is incumbent upon the Obama administration and federal policymakers to come up with a fiscal solution. Fiscal solutions involve the use of government revenue. Republicans for example have over the years advocated tax cuts for the very wealthy and businesses as a fiscal solution to job creation. Democrats on other hand are advocators of infrastructure spending, tax cuts to the middle class and direct and indirect spending on various programs that help lift citizens out of poverty.
The fiscal solutions offered by the mainstream parties do not address the consumer which is the answer to this dilemma of consistent job creation. Our downturn is primarily due to the lack of consumer demand! Consumers represent 70 percent of the economic activity of this economy. Thus, any recovery plan which will genuinely impact unemployment on a long term basis has to involve the consumer! Think of it this way, the fuel used in your car is gasoline and ethanol. The gas comprises about 90 percent of the mixture, just as the consumer is 70 percent of our GDP (gross domestic product). Exports and government spending comprise the other 30 percent. Take away the gasoline and the car does not move. Your car is not designed to just run on ethanol. That is the way the American economy functions, also. If you reduce the amount of money the consumer spends in this economy, the economic engine of this economy stalls and sputters. This is why our economy is sputtering, due to the reduced purchasing activity of the consumer!
There is a fiscal solution that is not out of reach and its efficacy is unquestionable. Go to http://www.thefixthistime.com. Getting this solution before the public and into the mainstream requires action from you right now. Can you risk ten dollars to make that happen? Buy the book, “The Fix This Time!” at Amazon.com where it costs $9.96. If 2,000 of you opted do this, enough capital will be generated to start a billboard campaign to further advertise this fiscal solution which should lead to more sales, thus catapulting the job creation plan advocated by the book into the presidential debates. It is through the vetting processes of the campaigns, a decision will be made about making this plan a legislative reality. In spending ten bucks now, you may end up saving your job or your business; the jobs of family members and the jobs of friends. Look, give me some credit! I was right about this economic recovery failing and I tell you, I am also right about the solution! Get busy people, let’s get this done… now!
Staff Writer; James Davis
This talented brother is a graduate of Florida A. and M. University(FAMU), a former stockbroker, and a human rights activist who resides in Sanford, Florida. He was awarded the prestigious Governor Haydon Burns Scholarship to attend FAMU and while at FAMU was awarded the first Martin Luther King Scholarship. He is also author of three books, among them are “The Fix This Time,” Expanding Social Security Benefits to Create Jobs and Spur Demand( http://www.amazon.com/dp/B00MI3PD2M ) and “Hey…God’s Talking To You,” The Study Book ( http://www.amazon.com/dp/B00GYI3VQW ).
He can be reached through his blog @, (http://www.thefixthistime.com).
