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What Drives Job Growth?

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    Former hedge fund manager Andy Kessler on what is needed to help boost a recovery of the job market.

  • Duration 4:57
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Either way folks to lead article in today's Wall Street Journal was -- still lamenting that -- It focuses on this year's election focus which is really what makes America work more precisely actually what will put more Americans to work.

The author of that article is a legendary hedge fund manager and author most recently of the book.

Eat people -- love that title Andy Kessler he joins us now from Powell author -- great to see you thanks for giving and appreciate it.

Well that's the question what builds jobs in this countries is center right now in the whole discussion of of what's gonna get America back and its feet.

And Nancy Pelosi came out with an idea of at least what could help the job situation a couple years ago let's play that side and get your reaction.

If you want to create jobs if the quickest way to do it.

Is to.

Provide more funding for food stamps.

And have unemployment.

Insurance.

Soul food stamps and unemployment insurance actually create jobs what do you think of that solution.

There -- -- exactly the opposite I mean there's this whole economic fought in Washington that if you just get money into the hands of the middle class that.

That the economy will grow but it's got it exactly backwards you care to increase growth just because you increased wages or give money out.

It's productivity it's it's it's doing more with less that that provides economic growth and higher paying jobs that you know -- the president in his.

Acceptance speech at the convention.

Said the following we believe that when a CEO pays his auto workers enough to buy cars that they build the whole company does better.

You know it it hearkens back to Ford Motor Co.

when Henry Ford don't pay the wages of his employees to five bucks but.

That's it's got it backwards it's gotta be productivity that drives growth what I read English and wages.

I think when you called it and and we should point out the fact -- when Nancy Pelosi said that we hadn't really sort of doubled down.

On the unemployment insurance and the food -- as we have -- and clearly it has not helped it may have actually aggravated did the job situation but it certainly hasn't -- that so.

That theory has been proven wrong over the past two years correct.

Surpassed -- sure pass I mean you don't look that the -- Summers and Geithner and -- -- -- were running around with numbers of these multiplier saying -- -- -- do a tax cut a dollar tax -- only -- -- point three dollars of economic growth put food -- gives -- one point 75.

Dollars of economic growth and it's it's completely backwards we go back to that Fort Stewart.

You know he doubled wages in the end that 1914 -- or forgets that in 1913.

He put in the moving assembly line and the -- time for automobiles went from fourteen hours to ninety minutes and -- tax increase -- productivity he can afford to pay.

Workers more.

-- that the price of automobiles dropped from 915 I was.

It was in everybody's economy no question and -- but but some would argue -- -- they're arguing this case these days as well.

That wins innovation without tremendous innovation you're talking about with a Ford Motor Co.

-- that we see with computers the same sort of thing.

That it actually hurts job growth because you get so productive that you can lay off more workers what do you say to that.

Well in the near term that happens often travel agents.

Bank tellers -- of ATMs but in the long run it it's the it's the shavings from that that provides a platform for others to great new jobs that didn't exist before.

I mean look at the -- phone the iPhone has gotten rid of -- things like maps in in restaurants and and -- -- eat into you know postal workers but it allows.

You don't workers -- white collar workers and blue collar workers to be more productive what they do that's a platform for others to create wealth fund.

So every cycle no matter watched.

More jobs and more better paying jobs are created vs the lower paying jobs the technology gets -- Either way getting back -- beginning we we should mention that those who focus on the government side of -- -- the handouts in the tax subsidies is creating jobs.

They're not just Democrats some Republicans are included -- bunch like Mark Zandi right.

Everyone's guilty everybody's guilty because.

These guys don't sit there and live and breathe and in -- in in a world.

We're we're productivity is what increases living -- they think that you know you can just signed a bill and you've increase living standards that works exactly the opposite in fact sometimes I'm.

I'm surprised that living standards increase at all given what goes on Washington but she got entrepreneur -- -- big companies small companies that every -- are scrambling writing code coming up with new productive things and that's what's driving economic growth and job creation and we've got to -- let it -- -- the kid out of the way they and let this stuff grow.

Okay and this is a guy puts his money where his mouth -- by the way so well you've got to listen to what he says he's got skin of the game anticancer good to see -- thank you Randi appreciate it.

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