(ThyBlackMan.com) Sometimes, we all need truthful, and factual information to make a good decision. The national media and newspapers purport to do this, based on some of their catch lines, but have miserably failed us. Recessions, in different, and intense ways, affect all of us. This predicted Economic Downturn, will be no different, and will also affect us. So, let’s get started, not with how bad things are, or even how bad, they are going to get. Let’s get started with how we can fix the most advertised Recession in modern history. If we all know it is coming, why can’t we fix it, this time?
You know, I can be wrong about this, but I don’t think anybody wants to go backwards. Black American workers are traditionally the first worker group laid off as the economy turns down. Blacks, in a way, are the canaries in the mine. The Wiktionary (a dictionary of sorts) defines “the canary in the mine concept,” the best. It states it is 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. That being so, Black American workers layoffs, will be our, and the nation’s warning (the canary) of the coming Recession. However, if you undercount our Job rates, as the Biden-Harris administration and Democrats do, you hide the number, of those coming layoffs from voters.
President Biden, Democrats, and the members of the Congressional Black Caucus (CBC), chaired by Steven Horsford of Nevada must also know this, that Black American workers are the first laid-off. But get this, knowing this, they want to continue business as usual, undercounting our Job rates, hiding coming layoffs, with millions of economic immigrants crossing our borders looking for Jobs, while we face a 3rd Recession in 15 years. Biden, and Harris want our votes. They spotlight the racist policies of Trump but decline to support and advance achievable economic solutions.
A most remarkable and obvious solution, to create Jobs and grow our economy, nevertheless is doable. Economists have long believed consumer spending works as a Job creator, and an economic engine of growth. Then, the Covid 19 Downturn struck, and all of us saw with our own eyes, economists are right. Consumer spending worked in real-time in our recovery, from the Covid 19 Economic Downturn! While there was growth, and job creation, due to spending during the pandemic, the Tax Cut to Families with Children stood out as being remarkably effective.
It caused a gust of growth, and job creation. Using Democrats’ figures, roughly $15 billion monthly in TAX CUTS started going out with 170 days left in 2021, as the Tax Cut to Families with Children programs got underway in July and ended on December 31st. It resulted in $529 million a day being given to, and spent by consumers, every day, on average. What Congress did was, front loaded money to Families with Children, based on the number of children, Internal Revenue Service records showed they had, and sent them a check, increasing their income, which they, then spent, creating Jobs, or put another way – demand for goods, and services.
1.091 million JOBS were created, in July, 483,000, in August, (in spite of the onset of the Delta variant), and 379,000 JOBS, in September during the peak of the variant, as many experts attested to the peaking, at that time. However, Republicans, objected to a direct tax cut going to that group of consumers, “Families with Children,” even though the principle of giving consumers “a direct tax cut,” as you can see, resulted, in consumer-spending expanding our economy, and creating millions of jobs, for professional, blue collar, and working-class Americans, across America.
Republicans want them “mean tested,” and work requirements applied. In objecting to Families with Children, as recipients of a direct consumer tax cut to pull us out of this “coming Recession;” are Republicans, and Senator Manchin, also objecting to the established principle, of consumer-spending, as a means to grow back lost jobs, due to the Recession? If they do, it is narrow-minded, as it is equivalent to rejecting “a proven” statistical method or a concrete way to create Jobs, and grow America economically in these truly menacing times, as autocrats, like Mr. Trump and tyrants, around the globe assert themselves.
It is going to require an increase in consumer spending to avoid large numbers of layoffs and slow growth, as higher interest rates work their way through our economy. Avoiding slow growth, which occurred after the Great Recession should be foremost in everyone’s thoughts, given that this Federal Reserve will be reluctant to lower interest rates right away, to stimulate the economy, after just raising rates to reduce inflation to 2.0%. A fiscal answer, from the Biden administration and Democrats, is required, as it should be.
The recovery from this coming Recession, will call for flexibility, if we are going to get the soft landing widely talked about in the media. To counter the effects of the layoffs of this Recession, the equivalency of $529 million a day in consumer spending may be needed, or not. Then, there are the latter stages of the Recession, where more consumer spending may be needed, but not as much as in the earlier stages depending on how deep the Recession goes. There is an alternative group of consumers, a compromise group if you will, who will be just as effective as Families with Children, when it comes to Job creation, but will also give the Biden administration “the flexibility it requires,” to solve the above issues, and put our economy back on a strong path of long-term economic growth, and Job creation, after the Federal Reserve halts rate hikes.
The age group, beginning at 55 plus years, are currently responsible for approximately 40% of consumer spending in our economy. Baby Boomers are the largest homogeneous population, within that group of consumers, and would be the more logical and, idea tax cut recipients. To get to this point, however, and to justify such a tax cut to voters, the REAL and true Jobless rate of 6.6% for April has to be accepted by President Biden, Democrats, and the CBC. Today is a good time to do such an embrace, while Job rates are at historical lows, rather than wait for rates to rise, when that task will be a lot more difficult. Mr. Biden needs no additional authority to declare the real Job rate.
A 10%, $25,000 Baby Boomers’ Consumer Tax Cut, which will drop approximately $254,000,000 a day into our economy, was designed to begin in 2021. That said, it will give the Biden administration the aforementioned flexibility, it needs. Biden can combine the outlined tax cuts of 2021, and 2022 of the tax cut plan, if a higher Consumer Tax Cut is needed, to bring inevitable layoffs into check, when the Fed ends hiking rates. This does not preclude the Biden administration from continuing the $254,000,000 direct consumer tax cut, the following year, and beyond, as Biden soft lands this economy. This tax cut is designed to include all Boomers, as the targeted tax cut group, no different than Families with Children, and the five tax cuts given to millionaires, and billionaires since 1980, during Republican led administrations.
Staff Writer; James Davis
Mr. Davis is, a Financial Analyst. His column is, about relating facts of a given situation, in a usable, truthful, and understandable way. James is, the author of three books, among them, “The Fix This Time,” Boost Your Retirement Income! Simultaneously Create Jobs and Spur Economic Growth (https://www.amazon.com/dp/B00MI3PD2M). Reach out to James @ his blog https://thefixthistime.com.
Question? Comment? One may use this email address; MrDavis@ThyBlackMan.com.