RUSH: Vinny, Bristol, Rhode Island. Vinny, great to have you on the program, sir. Hello.
CALLER: Hey, thank you, Rush. Great honor, once again.
RUSH: Great to have you here.
CALLER: Thank you very much. Merry Christmas to you and —
RUSH: Same to you.
CALLER: — and to Snerdley also. Hey, look, I’m puzzled by Wall Street’s reaction to what was the Bureau of Labor Statistics, the BLS statistics, 7% drop. You know, we’re down to 7% now in the unemployment rate, and what we have with the 205,000 jobs or so created, 41% were government jobs. I assume that’s state and federal.
CALLER: I remember one statistic that it cost $180,000 to initiate a government job, to give the guy $89,000 to 125,000 in salary.
RUSH: Something like that, yeah.
CALLER: Yeah. So I came to a calculation, just rough, and I know I’m off, it’s a little arbitrary, but at $48,000 median income for private sector, right? Isn’t that about right, somewhere in that vicinity?
RUSH: Yeah, it’s close.
CALLER: Yeah. It takes about 30 private sector people to support one government non-producer for the GDP, one government job. So taking that 83,000 jobs that are federal and rounding it off to a hundred —
RUSH: You better hold your thought. I thought you were going somewhere. I gotta take a break. Don’t go away.
RUSH: We’re back to Vinny in Bristol Rhode Island. How many private sector jobs do you think it takes to create a government job?
CALLER: I’m coming up with 30, but I think that’s conservative. And if that’s true we’re at a three million person deficit. That last report from the BLS should have been we lost effectively net three million jobs. If we figure 30 jobs where the federal and the state taxes were confiscated and put to pay for that single $180,000 job created by the Fed —
RUSH: Well, but 180,000 Fed jobs is a little high, because that’s GS14, you’re way up there. It might be better to you say a hundred grand as —
CALLER: Okay, even then. Even if we drop that figure in half the net result wasn’t 205,000 plus jobs. The net would have been 1.5 million.
RUSH: Right. So what Vinny is saying here, folks, is that the taxes, in order to hire government workers, it takes the taxes of X-number of private sector people, and you’ve got that anywhere between two and three million people, taxes necessary to hire a government worker. By definition, you’re thinking that’s how many jobs we’re losing in the private sector in order to have them filled in the public sector, right?
CALLER: Absolutely, to hire a hundred thousand federal workers or state and federal workers —
CALLER: — we are looking at a figure around — that should have been the actual no spin calculation —
RUSH: That’s never gonna happen. Never gonna happen. It’s gonna be left to people like you to point out.
CALLER: The stock market did not respond that way. I find that very odd. Now, you talked about —
RUSH: Well, the stock market is not responding to anything in the market right now.
RUSH: The stock market exists solely at the pleasure of the Federal Reserve. The Federal Reserve is pumping $85 billion of printed money every month. It’s in the form of the purchase of bonds and securities. And one of the problems, Vinny, that the Regime faces, the Fed is doing this, they say, to keep inflation down and to keep the economy churning because the economy wasn’t growing.
However, now that the Regime is monkeying with the unemployment numbers — and a lot of people think these are faked, like they were a year ago before the election — as the unemployment number comes down, because the Regime says it is, and as the number of private sector people working goes up, as the Regime says it is, then the economy is going to start theoretically growing, as the Regime says it is, which means the Fed will be less inclined to pump that $85 billion a month into the stock market. If the economy starts growing the Fed’s gonna say, “We can pull out of the stock market.” That is gonna cause the stock market people to literally panic. A bubble has been created in the stock market because nothing is happening, or very little is related to what’s happening in the market.
The money keeping the stock market at 15,000, 16,000, the DJI, NASDAQ, same, is coming from the Federal Reserve. And if they stop pumping it and putting it in there, hello bubble. So the Regime’s gotta be careful here. The Regime wants to report good economic numbers for PR. They want to report that Obamacare is the reason for it. They want to report people going back to work, but the Fed will then be tempted to pull out of the stock market. There won’t be any need to prop the economy up because it’s gonna be roaring, says the Regime.
So I don’t know what’s gonna happen. But the stock market normally, if the Fed were not pumping the money, Vinny, and if there were not $85 billion a month being printed to put in the stock market, the way a rising employment number would be dealt with is panic. The market would be panicking over the indication of inflation that is represented by the rise in employment. It has been the most remarkable thing to observe for the past 10 to 15 years. Great economic news — and this actually began to happen during the Clinton years. Great economic news, private sector economic news created panic in the market. They feared, because of Greenspan, inflation in the stock market.
It was crazy. When there was bad economic news, the market went nuts. Good. When there was good economic news, the market fell. Everybody is scratching their heads over it. They finally figured out that it was inflation everybody’s worried about because the Fed is controlling everything, not the market right now. And the Fed can do whatever they want to do when they want to do it. There’s no supervision. So if they reduce the $85 billion that they’re printing or eliminate it — I don’t want to see it, but there would be a lot of people with some schadenfreude who’d like to see it ’cause it’s an instant bubble.
It’s like the tech bubble in the early 2000s. I mean, there were tech companies worth nothing with valuations of five and 10 billion, all because these venture capitalists had put a bunch of money in. But there was nothing underneath it. There was nothing supporting them. Some of these companies had three and $400 share prices. And for what? It turns out nothing. The bubble burst and it was not pretty, and the same circumstance exists now in the market at large. So, anyway, Vinny, it’s a good call. I’m glad you made it through.
It’s an interesting point, folks, about the number of private sector jobs, taxes, ’cause that’s all necessary to create a government job. And look, I don’t mean to impugn government people here, but there’s a big difference in a government job and a private sector job. Nothing’s produced in the public sector. They’re just strictly taking. There’s nothing produced. The government does not add a thing to economic growth. The government cannot create wealth. All they can do is redistribute it or destroy it, but they cannot create it, and they don’t. Well, look, there’s exceptions to everything, and if Obama wants to give a crony capitalist partner $500 billion in so-called loans to build worthless windmills, yeah, I mean, it can happen that way, but again, that’s not real.
I’m talking about real, not artificial. And there just isn’t enough real anymore. Everything is artificial with this Regime, everything is. It’s either a lie or it’s artificial, but there isn’t anything substantively real that’s the foundation for anything happening in this Regime. Folks, it’s a disaster.