I have a plan that will drastically reduce unemployment. I don’t really know how to make a quantifiable prediction of its impact, but since I myself am not running for office, there’s no harm in my just throwing out a figure: If implemented, my plan will reduce unemployment to below 4.7% within two years. He’s not my guy, but I’m going to offer my plan, free of charge, to Governor Romney, as a gesture of bipartisan goodwill and because it just seems like it’s more in his wheelhouse.
Here’s the plan: Implement a national maximum wage. Ideally it would apply to all employees, but the political reality is that would never fly. So everybody currently employed is locked in at their current salary with that employer. But no new hire can be offered more than $30,000 per year. That’s total compensation: wages plus the market value of any and all benefits. The $30,000 figure is just for example; the economists can work out the exact number and if and how it should be adjusted over time. Keep in mind that this is not a uniform wage for everyone, it is a maximum. Employers are free to set salaries however they like, as long as they are less than the cap.
Do you see the beauty of this? Of course, keeping salaries low helps businesses’ bottom lines directly, which in turn promotes growth and new hiring. But the real key to this plan is how it moderates employees’ expectations. There are no doubt thousands of highly skilled workers that are currently unemployed because they can’t get a salary that is congruent with their abilities. If they understand that they will never earn more than the salary cap, they can stop holding out for reasonable compensation and rejoin the workforce. It’s win-win: if every job is a low paying job, employers can afford to hire lots of people, and employees can take the first job that comes along without consideration for the value of their labor.
It’s a simple idea, but a genius one. It can work. It will work. The only possible way it could not work would be if people were to realize that employment is not an end in itself, but a means to end of providing one’s self and one’s family with a sustainable quality of life. If people realized that, they might be less willing to accept “jobs jobs jobs” as a rallying cry and more willing to look at the broader and longer term impacts of social policy. But as long as they don’t realize that, let’s just cap salaries, write off quality of life, screw the future of the country and the planet, and put everyone back to work.
