Juno News - August 18, 2022


Trudeau's 'build back better' agenda creates fewer jobs

Mentioned
Justin Trudeau Ricardo Caballero Chrystia Freeland Thomas Sewell
The government can’t create jobs! Canada's legacy media slowly dies

Episode Stats


Length

5 minutes

Words per minute

183.53

Word count

1,051

Sentence count

68

Harmful content

Toxicity

3

sentences flagged


Summary

Summaries generated with gmurro/bart-large-finetuned-filtered-spotify-podcast-summ .

In the era of the post-caduce recovery, we ve heard a lot from politicians who are really sanguine about their ability to create jobs. They say that if the government spends money during recessions or during down economic times, they can stimulate the economy by creating jobs. But is there any truth behind the Keynesian economic theory?

Transcript

Transcript generated with Whisper (turbo).
Toxicity classifications generated with s-nlp/roberta_toxicity_classifier .
Hosts, guests, and mentioned names generated with spaCy (en_core_web_sm), reconciled against Wikidata.
00:00:00.000 In the era of Build Back Better in the post-COVID recovery,
00:00:03.380 we've heard a lot from politicians who are really sanguine about their ability to
00:00:07.060 create jobs. Take a listen. Create more jobs. Creating more steady, well-paying jobs. Creating
00:00:13.100 good jobs. 380,000 jobs. Creating good middle-class jobs. We need a million jobs to fill.
00:00:20.120 Our plan will create jobs. Create great, well-paying, local jobs. And create tens of
00:00:28.020 thousands of jobs. To invest in the jobs of the future. Our top priority is getting as many
00:00:34.180 people back to work in good jobs. And to create jobs. We just heard from a variety of Canadian
00:00:39.680 politicians from across the political spectrum, all saying that their government was able to
00:00:44.460 create jobs by spending your money. This is Keynesian economic theory that if the government
00:00:49.580 spends money during recessions or during down economic times, they can stimulate the economy
00:00:54.860 by quote-unquote creating jobs. Now they claim to create jobs in two different ways. One
00:00:59.920 is through creating jobs directly. That's if they create a thousand jobs by hiring a thousand
00:01:04.880 teachers, for example. They also claim to create jobs indirectly. That's through infrastructure
00:01:09.920 spending. These aren't direct employees, but it could create construction jobs, for example.
00:01:15.820 So while politicians will claim that they're creating jobs either directly or indirectly,
00:01:20.100 your argument is that on net there's actually job losses. The key here is to really look at
00:01:26.680 opportunity costs. So if they've taken all of that money out of the economy, they've spent that money
00:01:32.220 to quote-unquote create their jobs. How many jobs were lost because of the money that they've removed
00:01:37.360 from the economy? The government can only get money in three main ways. Taxation, by printing it,
00:01:41.980 or by borrowing it. And all of these three things create unemployment. Consider taxation, either a personal
00:01:47.440 income tax or corporate income tax. Both of those things remove disposable income out of the pockets
00:01:52.760 of either individuals or businesses. In the case of individuals, that means that they now have less
00:01:58.120 money in their pocket to stimulate the economy on their own, to buy goods and services that would
00:02:03.440 create jobs. When you look at corporations, for example, they're not just going to take a hit that
00:02:09.060 increased taxation would give them. So they're either going to raise the cost of their goods,
00:02:13.140 decrease or stagnate wages, or even eliminate jobs. And all of those things would decrease
00:02:18.480 employment. Yet politicians of all political stripes are still addicted to the ribbon-cutting
00:02:23.580 announcement that they've created jobs or they've made investments. Because at first, the results are
00:02:29.260 highly visible. If you've given a thousand people money to work, then everybody can see that you've
00:02:34.800 quote-unquote created a thousand jobs. But because the negative side effects of that are so widely
00:02:40.380 dispersed across the economy, it's far more difficult to point out the opportunity costs.
00:02:44.980 The reason why the government will always destroy more jobs than it creates by taking money out of
00:02:49.320 the economy is because of this simple principle. Nobody spends somebody else's money as carefully as
00:02:55.200 he spends his own. Because you've worked hard for your money, you want to spend it as wisely as
00:02:59.440 possible and make sure you get the best return on your investment. But the politicians and bureaucrats
00:03:03.700 spending your hard-earned tax dollars have different incentives. Perhaps re-election, so they want
00:03:08.840 short-term positive news stories like ribbon cutting and quote-unquote job creation. Or in
00:03:14.240 the bureaucrats example, perhaps they just don't want their budget slashed next year, so they're
00:03:18.160 incentivized to spend through the entire thing. So while politicians may claim to be investing,
00:03:23.440 and you'll hear that word so often, economist Ricardo Caballero said that investing means trading
00:03:28.860 the present for the future. But politicians often take the exact opposite approach when it comes to
00:03:34.520 quote-unquote investing. You'll always hear politicians say that they're making investments
00:03:38.700 for the future, but really what they're doing is short-term spending that's beneficial now,
00:03:44.080 and that actually will be quite costly and not the best decision for taxpayers in the future.
00:03:48.740 As famed economist Thomas Sowell says, 0.99
00:03:51.380 it's hard to imagine a more stupid or a more dangerous way of making decisions than by putting 0.99
00:03:56.280 those decisions in the hands of people who pay no price for being wrong. This rings especially true for 1.00
00:04:01.900 the politicians that we seem to have in Ottawa today, and it's hardly surprising that they make
00:04:06.320 so many errors when it comes to quote-unquote job creation in our economy when you look at their
00:04:12.000 background. So let's take a quick look. Let's start with Justin Trudeau, Canada's current prime
00:04:16.280 minister. Take a listen to this clip of him from 2014. It was the year before he was elected prime
00:04:21.460 minister in Canada. So in this economic climate, how committed to a balanced budget would you be right
00:04:28.320 now? Would it worry you to go into deficit in this current climate to, as you say, put more people
00:04:33.040 to work? The commitment needs to be a commitment to grow the economy, and the budget will balance
00:04:38.760 itself. He honestly believes that government spending is the path to prosperity. That's
00:04:43.000 terrifying. But when you look at his background, it's hardly surprising that he's so ill-informed
00:04:48.080 about economics. He didn't have any formal training in economics. In fact, he didn't have any real
00:04:52.660 business experience at all. He was a teacher for a few years before getting into politics.
00:04:57.740 Next up, if you look at federal finance minister and deputy prime minister, Chrystia Freeland,
00:05:02.800 while her resume is very impressive as a journalist, she too lacks the business credentials that she could
00:05:08.780 draw on to justify these grandiose claims she makes about her ability to create jobs in Canada.
00:05:15.240 True North actually did some great reporting on this and found that more than half of Trudeau's
00:05:19.700 cabinet have zero business experience. That said, Canada is a democracy. And while we don't vote for
00:05:25.180 the specific roles of who gets to fill prime minister or the rest of cabinet, Canadians did
00:05:29.600 elect a liberal government led by Justin Trudeau, who clearly lacks very fundamental economics and
00:05:36.400 business training or experience. And that shows when it comes to his abysmal track record on his
00:05:41.500 promises to quote unquote, create jobs.