Since the recession began, the private sector has regained about 30 percent of the manufacturing jobs it lost. Those jobs were created in spite of an array of regulatory policies that are detrimental to manufacturing’s expansion.
Add to that the administration’s health-care policies (which drive up the cost of employment by increasing medical insurance costs) and its environmental policies (which drive up the price of energy, particularly in Western Pennsylvania where coal is a major source of energy), and you can see why private-sector companies are skittish about enlarging payrolls.
That means the president has not only a small-business problem but also a blue-collar worker problem. Both are sources of those independent voters who are so essential to winning elections.
And add to all that the Dodd-Frank bill, says former Federal Reserve governor Larry Lindsey, “which has made it much more difficult for banks to make business loans, as more of their resources must be devoted to regulatory compliance and (the) building of capital than to granting loans.”
Partnerships are the key to economic growth. One of the great economists of the 20th century, Joseph Schumpeter, described entrepreneurs as “gap-fillers and input-completers,” meaning that they brought together everything that is needed to create output and jobs in one place, basically by partnering with various groups.
Having entrepreneurs as central to this process is better than having government or academics, because entrepreneurs typically have the knowledge to get things done and have their own money at risk, thus creating real consequences if they fail.
“While the president often talks about having ‘created’ jobs … he didn’t,” explained Lindsey. “Such jobs that have been gained have been produced by risk-taking entrepreneurs.”
All of that “shovel-ready” government stimulus money filled many state budgets but not so many private-sector job rolls.
The president’s resume does not include much indication that he knows how to create jobs – which may, in the end, contribute to him losing his job.