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Another gem from Dr. Tim.

Bouffant Nation
You probably don’t think of yourself as an employer, but you are: you create a job every time you hire someone to cut your hair. So let me ask you something: why do you create that job?

Do you create that job to help the economy recover? Do you create that job to reduce the unemployment rate among stylists? Do you create that job to correct a trade imbalance? Do you get your hair cut more often because President Obama or Governor Walker wants to create more jobs?

Would you get twice as many haircuts to earn a $5 rebate from the government? Would you go get yourself a B52-style bouffant if the government paid half through cash-for-coifs? If your state put a $100 tax on each haircut, would you pay it or create that job across the state line where there is no haircut tax? See - this employer stuff is not so complicated.

Unless you are a muttonhead, you only hire someone to cut your hair because you need a haircut – keyword need. And you hire a stylist with skills that meet your requirements – keyword skills. And you hire someone you can afford – keyword afford.

Job creation only happens when those three things come together: demand, skill, and price. No demand, no jobs; no skilled workers, no jobs; too pricey, no jobs. Can government compel those three things to heel? I think you know.

Government fiscal and monetary policy can do little to stimulate demand, as the past three years under both President Obama and President Bush have demonstrated. All the Keynesian multipliers in the universe cannot make your hair grow any faster, and deficit spending merely borrows from Friday to make Monday’s appointments more expensive. See - economics isn’t that complicated, either.

Government schools have diminished employable skills – reading, math, courtesy, ambition, competitive drive, achievement, standards, loyalty, discipline, accountability, respect – for decades. Government Affirmative Action programs and feel-good academic silliness have dumbed-down standards for college entrance tests, civil service exams, and professional certifications, diluting skills to achieve dubious social engineering objectives.

Government’s economic interventions almost always increase the price of labor. Regulation, taxation, unionization, and protectionism all add costs, but do not add any value.

So if government can not create demand, improve skills, or make labor more affordable, what can it do to help the private sector create jobs?

Watch it. Stand back and leave it alone; take as little as possible in the way of taxes, regulate only enough to make regular, and protect the sanctity of the exchange instead of picking winners and losers. Did you need government intervention to get your last haircut? Can you imagine how hideous a one-size-fits-all government-issued haircut would look like?

When this nation was founded, 95 out of 100 Americans grew food to feed themselves and the other 5. Today, with modern farm equipment and chemicals, 3 out of 100 Americans feed the whole nation and a good bit of the rest of the world. The industrialization of America spanned two centuries; the de-industrialization is occurring at a much faster pace. Since 2000, manufacturing employment has dropped by 63% to just over 11 million. And government has grown to 22.5 million and unemployment to over 15 million.

Our great-grandparents left the farm to work in the factories. Where will our kids go to make their dreams come true – the DMV? Subway? Paychex? Is the future going to be 10 of us driving around in Volts writing up carbon violations against the 3 of us that make windmill parts to fill up a warehouse until the tax subsidies run out and the Dutch owners close up shop? That seems to be the Obama/Biden vision. And trains, because…well, because.

The difference between the 19th century and the 21st century is that federal, state, and local government back then consumed less than 10% of GDP, so free enterprise was 90% free. Today, our runaway government spends over 60% of GDP, nags and nannies us to death, and deprives us of the energy we need to sustain our living standards based on a superstition that honest science has already abandoned.

Should we wonder why the recovery didn’t come again this time around like the Easter Bunny always does? The more our governments do to “help”, the more we prolong the deep recession and high rates of joblessness we have become mired in. You can’t be for jobs and against the corporations that provide them.

And we cannot just be Bouffant Nation, where the Fed prints scads of money and we all cut each other’s hair. We need to invent things here, to make them here, and to export them from here all over the world. That takes energy, a skilled workforce, sound money, and less government than we have now – a lot less.

The trick to free enterprise is the “free” part. Get government out of the way and we will quickly discover that American ingenuity did not die; it has been napping until the day when it can again thrive free of government interference.

“Moment Of Clarity” is a weekly commentary by Libertarian writer and speaker Tim Nerenz, Ph.D. Visit Tim’s website <!-- w --><a class="postlink" href="http://www.timnerenz.com">www.timnerenz.com</a><!-- w --> to find your moment and order his new book, “Tooth Fairy Government.”