Where Do Real Jobs Come From?

The pentagon goes rogue…

“Jobs engine sputters again in April,” reports the weekend Wall Street Journal.

What kind of humbug recovery is this? Bloomberg adds:

Estimates for the jobless rate, derived from a separate survey of households, ranged from 8.1 percent to 8.3 percent. Unemployment has exceeded 8 percent since February 2009, the longest such stretch since monthly records began in 1948.

Of course, it’s much worse than that. John Williams puts the real unemployment rate — the people who want jobs and can’t find them — at 22%…the same as the unemployment rate in Spain. And just 3% points lower than in the Great Depression.

And what kind of humbug response is this? Reuters:

(Reuters) — The White House pledged on Wednesday to help lower-income youth find summer jobs in a move likely to appeal to younger voters crucial to President Barack Obama’s re-election campaign.

The initiative is in partnership with the cities of Philadelphia, Chicago and San Francisco and is meant to add 110,000 jobs, internships and mentorships to the 180,000 summer work opportunities for 16-24 year olds that Obama has promised to create for 2012.

Under the new program, companies such as Blue Cross and Blue Shield Association, Johnson & Johnson, and UBS, as well as non-profits and federal agencies such as the Department of Education will offer paying jobs as well as mentorships and other training programs.

Every year from April to July, the size of the youth labor force swells as high school and college students nationwide look for summer jobs. But summer employment for young job seekers has hit record lows in recent years as more of them are unable to find work, according to data from the US Bureau of Labor Statistics.

“There’s no replacement for the dignity that comes with earning your first paycheck,” said Secretary of Labor Hilda Solis in a statement.

Yes, dear reader, now the feds are turning young people into zombies too…with make-believe jobs, many of them in zombie industries.

The report went on to tell us that the initiative does not require congressional approval. Which leads us to another question:

What kind of crackpot system do we have…where the president can create jobs…like the Fed creates money…out of thin air? Of course, we know the answer, the new jobs are just like the new money; they’re not real.

The program, phony as it is, will not be examined carefully by anyone. Instead, it will “feel good” to the voters. Obama is doing something. His heart is in the right place. Don’t think about it anymore.

His initiative is right out of Franklin Roosevelt’s playbook. Back in the ’30s, our own father participated in something called the CCC, the Civilian Conservation Corps. He was a poor boy. His father was dead. He needed a way to support himself. So he joined the CCC.

“It was like the army,” he recalled years later. “It was like a junior version of the Army Corps of Engineers. And it was hard work. I helped dig irrigation ditches in New Mexico.”

Make work, perhaps. It may not have been a real job, but at least it was real work. A whole lot less phony that hanging our mid-level bureaucrats in an air-conditioned office at the Department of Education.

Did you see our rant about education last week? Education, along with health care, finance, and the military are the big zombie industries of the late, degenerate imperial period (as future historians will describe it). They drain resources out of the productive economy…and waste them. To give you an idea of the scale of the waste, the 2009 Program for International Student Assessment gave tests to 15-year-olds in 65 different countries. The US spends far more than most countries on education, so you’d expect that it would come out on top, right? But nooo.

Instead, China-Shanghai came in first. China-Hong Kong second. Finland was third. In terms of educational “investment” per student, the US spends 15 times as much as China. Even at the state level, educational “investment” has little to do with educational return. Idaho spends only about $10,000 per student. Washington, DC spends nearly 4 times as much. Which has better test results? Idaho, of course.

So, what do the zombies say? We need to “invest” more in education!

*** We’re always trying to connect the dots. Unfortunately, the dots won’t stand still!

Last week, we were thinking about how democracy…or any government…operates on the basis of shared emotions, or feelings, rather than real ideas. We explored the public’s contemporary narrative on the financial crisis. What we saw is that a common view of what is going on — in order to be commonly shared — has to be stripped so bare of nuance and paradox that it ceases to be an idea at all. It is just a feeling.

And sometimes, it becomes a grotesque, simpleminded fantasy that it is actually the opposite of the original thought or desire behind it. It becomes a zombie thought…actually harmful to the group that holds it.

If you follow the popular media, for example, you would think that the US is engaged in a war against “terrorists”…bad people, who for a reason never explained, aim to do harm to Americans. These terrorists are so evil they must be stopped…at all costs.

“It’s a war,” says US Attorney General, Eric Holder. So, he explains, we can set aside the Constitution and the Bill of Rights — the very things we’re supposed to be defending — to fight it.

Thus is the US military industry set to the task of protecting against “terrorists”…with the solid support of the American people. An announcement at the Ft. Lauderdale airport on Friday told us that “military personnel can board at their leisure.” They got the treatment normally given to paying business class passengers! On one plane, a stewardess invited military personnel to take the vacant seats in the business class section. And it was reported last week that of all America’s public and private institutions only the military retains the confidence of the general population.

But if you bother to study the situation at all you quickly realize that it is not terrorists who pose a threat to the US, it is the US military itself. The Pentagon has gone rogue…now it is a danger to the nation.

Terrorists are insignificant. Trivial. You could fit all of them in a mid-sized movie theatre. And half of them — like Osama bin Laden himself — are so infirm, insane or incompetent that they are completely incapable of doing any real damage to the world’s only super-power.

The US military — along with its suppliers, security agencies and all the rest of the lethal establishment meant to protect America — is big. And very expensive. Like a parasite, it drains energy and resources from its host — the productive US economy. The total cost, fully loaded, is about 8% of GDP.

America is, of course, no normal nation. It is an empire. The cost of running an empire is high. But empire is supposed to be a paying enterprise. An empire takes tribute from its vassal states in exchange for providing protection. That’s how all empires worked.

The US empire, on the other hand, loses money. It conquers foreign nations…but it fails to make money at it. Instead of sucking resources from its vassal states, it takes resources from the American public. It is no longer protecting the nation; it is endangering it.

More to come…


Bill Bonner
for The Daily Reckoning