Paul Krugman made the bold (for a main stream media journalist) move of clearly stating the obvious in his most recent NY Times Op-Ed today.

What can be done about mass unemployment? All the wise heads agree: there are no quick or easy answers. There is work to be done, but workers aren’t ready to do it — they’re in the wrong places, or they have the wrong skills. Our problems are “structural,” and will take many years to solve.

But don’t bother asking for evidence that justifies this bleak view. There isn’t any. On the contrary, all the facts suggest that high unemployment in America is the result of inadequate demand — full stop.

So what you need to know is that there is no evidence whatsoever to back these claims. We aren’t suffering from a shortage of needed skills; we’re suffering from a lack of policy resolve. As I said, structural unemployment isn’t a real problem, it’s an excuse — a reason not to act on America’s problems at a time when action is desperately needed.

I think the reason why this is such a revelation to those people who do not actually run a business or  have a PhD. in Economics is the machinations of our economy are FM.

What is FM? Well, in the immortal words of one of my former District Sales Managers FM is Fucking Magic. It might as well be a hamster on a treadmill grinding away in the background because most people have not a clue why businesses are still laying people off or why unemployment remains high.

But I can tell you. It’s plain and simple and Krugman is absolutely right. Demand IS down, in the basement as a matter of fact and remains there. The only reason company’s are making profits quarter over quarter is that they have been able to cut back on fixed cost (read people) without actually negatively impacting the delivery of their products and services. This could not be were the demand there.

The question I have now is why are so many people afraid of allowing the Government to create that demand? It’s not FM.

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