Creating Jobs

I think about this all the time. Who could spend to create jobs? Jobs would create spending, spending would create activity, activity would create more jobs, the economy would come back to life.

First, the math:

Let's say you hire people at $25,000 a year. So:
10 people = $250,000
100 people = $2.5 million
1,000 people = $25 million
10,000 people = $250 million
100,000 people = $2.5 billion

I have oft heard it said in stories about the economy that a healthy economy would be 100,000 new hires a month. So let's say that was our aim. How much would that cost? Well, 36 billion dollars for one year, and 71 billion dollars for two years. (I originally had thought 24 billion, discounting the .5, which it turns out is kind of significant.)

The government could pay for it. The federal government could hire a million and a half new Americorps employees to work in the nation's schools, tackling hiring and education in one fell swoop.

Or the private sector could pay for it. The top 100 richest Americans (all of which have more than $1bn, I assume)(I'll have to check that) could each contribute between $500m and $10bn to rescue the U.S. economy. It could be argued that the money would quickly come back to them in the form of a reinvigorated consumer economy and stock prices.

And that's an overwhelming plan. If the plan was halved so that it was only $18bn a year, it would still have a huge impact on the economy and wouldn't tax the ultra rich nearly as much.

As I have said many times, the rich in this country could re-invigorate the economy if they chose to, through direct spending. Putting money into Wall Street allows companies to amass giant cash reserves and not spend any of it. Putting people to work puts money immediately into the consumer economy and pumps lifeblood into a system that is struggling for air.