Comments on: Roosevelt and Bush

By: LamontCranston

LamontCranston — Wed, 09 Feb 2005 01:43:12 +0000

George: “Is that the line Willy Wonka quotes to Veruca Salt? (in the movie)”—Gene Wilder (Willy) filled the script with literary references. jet: “Would getting rid of unemployment benefits get rid of the unemployed? Or would we just have to find another way to count them?” yeah another way would have to be found to count them, primarily as homeless and/or dead.

By: Jussi

Jussi — Sat, 05 Feb 2005 17:41:28 +0000

“It also depends on how you define unemployment. The US unemployment numbers are calculated differently than some of those other countries, IIRC. I am trying to find a link for how that number is calculated- does anyone else have one?” There is an ILO definition for unemployment. I don’t have a link, but it is (roughly) that you have to be a) unemployed; b) have looked for work in the last 4 weeks; and c) you must be able to take up a position within 4 weeks. If any of these criteria are not met, you don’t count as unemployed. (A housewife, for example, is not looking for work, and therefore is not unemployed – she is ‘economically inactive’). This is the statistic one normally sees in international publications, or at least the ones I read. However, individual countries may also have their own definitions. For example, I believe the UK publishes a statistic called ‘Unemployed and receiving benefit’, which allows the long-term unemployed who don’t qualify for ‘unemployment benefit’ (but for something else instead) to be removed from the domestically published unemployment number. Handy, right?

By: Jussi

Jussi — Sat, 05 Feb 2005 17:26:14 +0000

“Could it be that German unemployment has something to do with their unification problems, i.e. more political and cultural than economic? The western part seems to be doing just fine.” Indeed it does have to do with their unification problems. The parties in government at the time had been calling for unification for 40 years, and were adamant that the ‘German question’ had not been settled. As it turned out, they were right; but unbelievably they had no plan of what to do, nor even any up-to-date information around which they could have made a plan. It left one breathless with amazement! What awaited them on the other side was extremely run-down, much as in the other eastern bloc countries. Roads full of potholes, decrepit buildings, no modern phone system, uncompetitive industry, etc etc. The human infrastructure too was partly unusable. The Stasi (security service) had to be rooted out, and brought to justice, where necessary. Many teachers lost their qualifications, because they were deemed to have been ‘indoctrinated’. The police were suspect. The entire governmental and state apparatus had to be replaced and restaffed. And of course the legal system had to go too – the west imposed its laws lock, stock and barrel, including the wretched bureaucracy. Then there were mistakes made by politicians (and others). One notable blunder was committed by Helmut Kohl, who, hoping to win votes in the upcoming elections, allowed the East Germans to exchange their Ostmarks for DM at a rate of 1:1 instead of the more sensible 2:1 or 3:1. The easterners grabbed the money and gleefully went on spending sprees in the west, leaving none of it in the east where it was needed most. (But Kohl got the votes). There was, and still is, a lot of antagonism between the ‘Ossies’ (east Germans) and ‘Wessies’ (west Germans), which does nothing to help the situation. The stereotype is that Ossies think Wessies are arrogant know-alls, and Wessies think Ossies are lazy good-for-nothings. At any rate, the west has done a great deal in terms of improving the infrastructure, and has transferred huge sums of money to the east – it must be close to about $1 trillion by now. But despite all, the east is still economically depressed, and worst of all, plagued with a very stubborn unemployment problem. Thank heaven I don’t have to deal with it.

By: winna

winna — Fri, 04 Feb 2005 16:34:59 +0000

It also depends on how you define unemployment. The US unemployment numbers are calculated differently than some of those other countries, IIRC. I am trying to find a link for how that number is calculated- does anyone else have one?

By: abb1

abb1 — Fri, 04 Feb 2005 14:19:47 +0000

Cranky, if you get an error and want to make sure your comment has been posted, click the ‘Preview’ button and scroll down – you’ll see all comments including those that got stuck in the plumbing. Cheers.

By: abb1

abb1 — Fri, 04 Feb 2005 14:15:53 +0000

Could it be that German unemployment has something to do with their unification problems, i.e. more political and cultural than economic? The western part seems to be doing just fine.

By: Cranky Observer

Cranky Observer — Fri, 04 Feb 2005 13:17:41 +0000

> If we all made the same amount > reguardless of what we did, > wouldn’t everyone be an ice cream > man, rock star, or bar tender? We’d > all be fat, deaf, and constantly > drunk, but we’d miss our high > standard of living. You may recall that I did say this was an area where argument was appropriate. You have stated one side of the argument succintly: that the lash is necessary to keep man’s nose to the grindstone, that nose to the grindstone is the preferable form of existance, and that maximization of consumption is the greatest goal of mankind. The grindstone portion of this theory reaches its apex in the Amanas, for whom hard work throughout one’s life is a prerequisite to entering heaven. There are however other ways to look at life. If nothing else, given the world’s population I think there are more than enough Type As and Super Type As to keep everyone else in beer and ice cream even if they were the only ones working. But I think most people enjoy a reasonable amount of work (20-30 hours/week) – which probably goes back to the desire to hunt a zebra every 3 days. > And why is that > a secret, if you divide 10 > trillion by 300 million, you get > quite a bit per person? Um, because if it were well-understood by the entire population the opportunity for Ken Lay and his ilk to accumulate hundreds of millions of dollars of other peoples’ money would be greatly reduced? Cranky

By: Jussi

Jussi — Fri, 04 Feb 2005 12:21:31 +0000

“The Netherlands public sector is about a third the size of Denmarks, and population about three times as large.” dk, how do you mean that? – are you saying that DK needs nine people where NL need only one, or that DK spends nine times as much money? Or something completely different? (Forgive my rough arithmetic, but just for this question I’m assuming GDP per capita for the two countries is about the same – which in reality it isn’t).

By: am

am — Fri, 04 Feb 2005 02:43:32 +0000

heh, 1937. We’ve learned a lot since then, haven’t we? Well. Some of us have.

By: jet

jet — Fri, 04 Feb 2005 00:09:22 +0000

Kevin, Thanks for the read, that was very interesting stuff. It is one thing to hear that Europeans are much more generous, but it is another thing to see it quantified. Although I would have liked to have seen the average time in each country until someone on unemployment started a new job. The study alluded to it being shorter the worse the benefits, which would seem to endorse the US system, unless you think people should get to chill watching Jerry Springer while someone else goes to work for them. Cranky, How many people who chose a career (rather than falling into one) do so because they want to make more money? If we all made the same amount reguardless of what we did, wouldn’t everyone be an ice cream man, rock star, or bar tender? We’d all be fat, deaf, and constantly drunk, but we’d miss our high standard of living. And why is that a secret, if you divide 10 trillion by 300 million, you get quite a bit per person?

By: dk.au

dk.au — Fri, 04 Feb 2005 00:08:38 +0000

Jet I’m not aware of a significant Dutch population in Denmark (I think the Germans in the south of Jutland are recognised though). The Netherlands public sector is about a third the size of Denmarks, and population about three times as large. Liberal forces are breaking down traditional Socialist tenets in both countries (ie. unions), but the ethnic/cultural homogeneity seems to be keeping it all together in a way Anglo liberal systems can’t/don’t.

By: Cranky Observer

Cranky Observer — Thu, 03 Feb 2005 21:55:23 +0000

> Just how does the US, with a much > larger more diverse population, > keep their unemployment so low? Here is a secret that I am sure the Greenspans of the world know quite well: since about 1965 or so, the Western world has had the capability to provide its entire population with a reasonable standard of living (say US 1955 middle class standard – by historical terms luxurious) using about 1/3 of our total capability (whether you count capability as people, labor hours, resources, factories, whatever). In other words, we could loaf along on 22 hour workweeks and still live the life of the Cleavers. But there are social reasons why that may not be desirable. Debatable to be sure, but reasons. So the powers that be have chosen to prevent that from happening. The US and Europe have chosen different paths. Europe uses various social transfer mechanism to keep large numbers of people out of the workforce (long university stays, family leave benefits, unemployement dole). The US uses differential pay incentives and harsh unemployement consequences to keep everyone’s nose to the grindstone at a fairly low average wage. Both accomplish the same thing (rising output and social stability) but from different directions. Cranky

By: Kevin Donoghue

Kevin Donoghue — Thu, 03 Feb 2005 21:37:37 +0000

Jet, A bit of Googling appears to confirm my hazy memories of the literature. A point I had not noted is that the duration of unemployment benefits seems to be more important than the level. This PDF file is worth a look: http://doku.iab.de/topics/2004/topics56.pdf

By: Kevin Donoghue

Kevin Donoghue — Thu, 03 Feb 2005 20:57:54 +0000

On a site which includes philosophers in its management, I hesitate to say this, but it depends on what you mean by unemployed. If defined as those claiming benefits then yes, getting rid of benefits gets rid of the unemployed. The other way to count them is by doing a survey which asks people about their current status. Certainly there will be respondents who describe themselves as unemployed. But with no benefits they have a pretty strong incentive to change that status. As I pointed out earlier, this comment is not based on any recent study. It certainly isn’t a policy proposal. But I think you will find that the generosity of unemployment benefits is a significant variable in determining unemployment rates. Other things matter too, of course. For example, the Fed is a much more growth-oriented central bank than the ECB, which is modelled on the starchy old Bundesbank.

By: jet

jet — Thu, 03 Feb 2005 20:36:58 +0000

p o’neill, Oh no you didn’t just bring up Denmark. Can you really compare a country of 5 million with a country of 300 million? As long as we are comparing apples to ornges, I’ll bring up Florida (16 million people and 4.9% unemployment) and say “eat that Denmark”. But it is great to hear the Dutch are doing well, it just appears their model doesn’t scale very well. Kevin, Would getting rid of unemployment benefits get rid of the unemployed? Or would we just have to find another way to count them?