Yesterday morning I woke up in what would have been a pleasant rain, if it hadn't been raining on me. At 5:30 am I found myself standing next to KS, my best friend of thirty plus years, under a narrow rock ledge, listening to thunder and watching everything in our camp get soaking wet. I piously announced that the situation called for a speech. KS said: "let's hear it." I reproduce my rhetoric in its entirety.
We should'a brought the fracking tent.
I didn't exactly say "fracking." There was no applause.
At that moment I felt Obama's pain. He has been on a bus tour. The Administration denies that it is a campaign event. It's a campaign event. Then the White House made a major announcement. From Michael Shear at the New York Times Caucus:
"In early September, we will put forward proposals for jobs-creating ideas and economic growth ideas," Jay Carney, the White House press secretary said Wednesday morning. "We want to be aggressive with deficit reduction that helps pay for things you need to do in the near term to grow the economy."
Well, that's our man. In drouthy middle August, when the bones of meadows show, we are told he will make a speech about jobs … in September. The Administration will no doubt deny that this is a campaign event. As Mr. Shear explains, it's a campaign event.
A major jobs speech by the president could help set a campaign narrative for Mr. Obama as his Republican challengers increasingly focus their attacks on his handling of the economy. Top aides to the president are eager to show that his ideas are being stymied by a recalcitrant Republican Congress.
Okay, but for that the speech has got to work. Mr. Shear concludes:
White House officials have said the president's speech — to be given soon after Labor Day — will contain new ideas that go beyond those he has made in the past several weeks.
Nobody, and I mean nobody, thinks that the White House has anything new up its collective sleeve. Even if they did, the advance warning just makes them look more hapless in the meantime.
It is doubtful that this President or any other could do much to increase employment in the short term (= between now and the election). I think it's pretty clear that Administration isn't thinking about that. They are, as Mr. Shear acknowledges, thinking about the "campaign narrative".
To find someone who is thinking about it, I offer Mickey Kaus.
Hey, here's your Big Jobs Idea: It looks as if the UAW is about to agree to new contracts based on flexible pay–e.g. no raises, but bonuses linked to something like profits. Why is this signifcant? Because if the entire economy were filled with workers whose pay was flexible, there would be a lot more jobs. At least that is the argument of economist Martin Weitzman in his 1984 book The Share Economy…
If workers make only their base pay plus a share of profits, for example, employers have an incentive to hire people as long as they are worth the base pay. Meanwhile, the deal can be structured so every new hire slightly dilutes the "share" of all the previous hires. Where before you were splitting the profit "pot" by 100 workers, say, now each worker gets 1/101th. That's not gooey–it's even a little nasty. But the upshot is that employers have an incentive to scoop up workers like "vacuum cleaners" in good times and to avoid layoffs in bad times.
There is an idea. I like the idea of predictable raises. I used to get them. As you get older, your pay goes up. There is more than a little logic in that. Older workers might be generally more valuable for their experience. Workers can look forward to increasing prosperity over their careers. If the employer's cash flow is increasing, it is the sort of thing the employer can afford. However, the raises will sooner or later add up to the cost of some number of employees whom the employer would like to hire but cannot afford. Kaus' reform would trade wages for jobs. Which would you rather have, if you have to choose?
This is not the kind of thing a President can enact; however, it is the kind of thing he could promote if he were into thinking. He could take credit for it later. If the UAW is really prepared to sign on to something like this, it is a very good sign for the auto industry and the American economy as a whole. It is not a good sign for the unions. The whole point of a union is to make hiring less flexible by protecting existing workers against job seekers. The point of Kaus' reform is to encourage hiring by removing those protections.
I expect that the President will offer nothing as interesting as that. He will say a lot of things that nobody will pay much attention to. So I will offer my own speech. It will come in November. It will involve a fracking tent.