State lawmakers on Tuesday afternoon listened to a parade of experts assessing Georgia’s economy and the likelihood of recovery.
By far the star performer before a joint meeting of the House and Senate economic development committees was economist Robert Prechter, who has become famous for predicting the 2008 crash – in a 2002 book, “Conquer the Crash.”
Gov. Sonny Perdue has built his 2011 budget around the belief that the economy has bottomed out and that better times are ahead. Prechter expects financial markets to tumble again this year, in a crash larger than the one in 1929.
“Even though Wall Street says 2010 is a year of recovery and bottoming out, I’m looking at it as more like the year that’s going to resume the problems that we had in 2008,” said Prechter, who should be required to issue his audiences free rolls of Tums whenever he opens his mouth.
Though he admitted that some of his ideas might be considered “radical,” Prechter gave lawmakers a list of do’s and don’t’s for coping with the coming economic Armageddon.
Economic stimulus packages don’t work, the free-marketer said. Neither does raising the minimum wage. Avoid tax or any other kind of subsidies, including those that address education or job skills.
“We’ve got education coming out of our ears. We’ve got more people going to college than at anytime in the history of the United States. If education created jobs, then there would be more jobs than we have people,” he said.
There are people, like college presidents, who argue that education is a key to unemployment. But they would say that, wouldn’t they? Prechter pointed out.
The economist/author also argued against any extension of unemployment benefits, “which sucks money away from employers, which makes them lay off more workers.”
Prechter offered this question for debate: “Is it really better to pay someone $100 a week for not working, than to let an employer pay that person $100 a week for work?”
To boost the economy, the economist offered up a free-marketer’s wish-list: Elimination of minimum wage laws and medical coverage requirements, plus repeal of licensing laws and as many business regulations as possible.
But then came the topic of kids. Said Prechter:
“This is, of course, a very delicate subject. Child labor laws, I think, are an impediment in some very extreme circumstances. There could be families that really, seriously depend on having a young person out in the work force.
“Now, people generally think that means there’s going to be these factories or [kids] busting rocks in the hot sun. But many, many jobs are low impact for young people, and I think they should at least be free to decide for themselves if they want to be employed or not.”
It was not clear that state lawmakers were willing to embrace this suggestion. And Prechter’s last recommendation for stimulating the economy was a complete turn-off for many Republicans:
“This may be unpopular, but I believe we should not, as a state, cooperate in the persecution of illegal immigrants. Everyone who’s employed is adding to the economy, and that makes more opportunity for people, not less.”
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