Boston Tea Party?

Since the bursting of the housing bubble, the rate of unemployment has been growing, now at approximately 10%. This is not the real level, as many who remain unemployed have given up looking or have taken jobs beneath their skill level just to pay bills. Job losses are dwindling, from some 700,000 per month to just under 100,000, but much of this destruction has already taken place. Please see the following chart by the excellent blog Calculated Risk:

Although the 10% unemployment rate, which will likely rise a bit in the forthcoming months as this is a lagging indicator, is a very significant and real problem for many Americans, there is a bigger problem many are not aware of or are discounting.

Outside of the expansion of the government payroll, even with the incredible amount of stimulus, there is no job creation going on and without private sector expansion, high unemployment and a lack of prosperity will continue.

Uncertainty is the biggest obstacle small business owners face. The administration is working on very costly confiscatory taxation measures in health care reform, energy through the cap and trade legislation and business regulation. When you tax something, you get less of it, and as long as small business America is unsure of the playing field, forecasting the costs of doing business is difficult to measure. Given the looming legislation, most business owners project a significant rise in these costs, which is very prohibitive to increasing payroll.

Meanwhile, the consumer is ravaged. Many of the small businesses, from local restaurants to mid level production facilities, need consumption from the consumer to achieve acceptable revenue levels, but the consumer is in full scale saving mode, adding to the problem. Businesses hoping to borrow in an effort to survive the storm have very limited available outlets as the credit markets remain extremely tight.

The above referenced chart shows we are currently at the bottom of a very big hole, but due the policies of the administration, there is little or no evidence we are emerging out of the hole. While GDP may increase slightly, you will note in the chart that most of these big dips are met with a strong rebound. Not happening today.

Remember, socialism (don't kid yourself, this is where we are going) is great until you run out of everyone else's money. Ask yourself how many of your friends have come close to or have exhausted their 401K's this past year. Governmental actions have done just about nothing to solve the economic issues and I maintain have made them worse. Now what?

Increased governmental influences and interaction in the marketplace is hampering growth and keeping a hard press on employers. For this situation to be resolved, taxes and regulation on small business must be decreased, credit lines must opened and looming legislation fitting the plan of wealth redistribution must be scrapped.

Free market capitalism is the best path to prosperity. Those taking us down a different path must be stopped. As a new day begins tonight for Jack Bauer, a new direction for this country make take place later in the week with a good old fashioned tea party in of all places, Boston. This is change I will be hoping for!