Instead of paying companies with the taxes we take from them to create jobs, why don't we just lower their taxes?
Then they might feel more "appreciated."
Sunday, July 01, 2007
Millions for jobs worth it?
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14 comments:
Subsidies almost always never do what they are designed to do. And those who complain about corporate welfare the most ironically are the same people responsible for it.
For example, I was shocked when Bill Richardson in one of the recent debates promised to be against corporations and corporate welfare, and then promised to protect American jobs and provide incentives for job growth. The only way one can do that is to provide tax breaks and subsidies, or to add taxes or tariffs to your competition-- which is what corporate welfare is by definition.
Corporate taxes are also something that need to go, since the reduced saving and investment they cause translates into fewer jobs and lower wages, which is directly felt by workers, not shareholders. The benefit would also ironically help leftist causes-- the faster rate of economic growth would ameliorate the tough choices we're going to face down the road with our entitlement programs, the cost of which is currently exploding.
Well done...meaning there will be no liberal response
C'mon,GAME,I'm having to respond more as the comedy hasn't been offered much to the last group of your RIGHT ON POSTS.What has become
of the jumbled,mo-ron-ic,lip-service retorts that are so enjoyable in starting off the daily routine?This post by Jason,RIGHT ON as usual,may not get much if any response.Hope there's some anonymous out there?
You guys seem to be operating from the false premise that corporations hire workers because their taxes are lower and profits are up.
That's not true at all. Corporations create jobs because of the value they get in doing so; anybody who's ever run a business knows that. If your profits are up you don't run out and squander them on a superfluous employee; you either take a cut of profits - rewarding yourself for a job well done - or save them up for a base of capital to cover you through future lean times.
The only time you consider hiring new employees is when demand for your services or goods expands. The expanded demand creates an increased workload that justifies the new employee. If the government wants to expand jobs then they should be expanding demand for products; and the way to do that is tax cuts for the people who actually spend their money at businesses in the United States.
That's not corporations, and that's not the rich. The middle class and the poor drive demand in the economy, because there's a lot more poor and middle class than rich people.
Corporations won't just create jobs as a "thank you" for massive corporate giveaways and subsidies. They do so when it's in their best interest, and the way to make that in their interest is to expand demand for their products. Cutting taxes on the middle class and shifting the tax burden to the rich - back to its natural level - would do far, far more to create jobs than corporate giveaways and tax cuts for the rich.
I don't think it would be too off topic to point out a story in today's Daily Herald here in Illinois' NW Suburbs. The front page headline is as follows:
"Is minimum wage costing businesses state contracts?"
The story goes on to say how our thoughtful Springfield geniuses raised the state minimum wage to 8.25/hr by 2010. Today it shoots up to 7.50. The fed rate will only be 5.85 this summer. Long story short, a downstate data-entry center for a Hoffman Estates based Rely Services has for years held state contracts to manually input tax and vehicle data. But in bidding to keep those contracts, they were undercut by firms from out of state where they have a lower minimum wage. Their workforce will plummet from a peak of 134 people down to 14.
The point is how negatively the impact of government manipulation of the flow of money. In this case it's wages, but the effect is the same with taxes. It effects the operation of the business by messing with the cash flow. It really doesn't matter if the company turns profits into employees, the concept is foul. One business may need the funds for internal maintenance, another for research, still another for expansion. A drop in the tax burden might allow them to drop their prices, thereby affecting demand as more people can afford the product more often.
A far better way to reduce the tax burden on the people Chet cares about is to eliminate the bullshit entitlements and unnecessary programs on which the feds are spending our money. Fewer things to financially support, fewer reasons to tax the crap out of the population.
Marshall hit it right on the head...
How much would our taxes have to be in the govt wasn't trying to play parent to millions who have been told that it is not their fault they are helpless...
Also, since when do rich people not spend money?
Chet says the middle class spend all the money on stuff and that is why they need tax cuts...to increase demand...
I get the supply/demand thing...
However, some business owners are going to want to expand business when they have more money...you have to admit atleast SOME will, creating more jobs.
NO business will create more jobs when they have to give it to the govt
Marshall hit the ball out of the park. I was on base, but he gets the RBIs this time.
Chet is trying to say poor people hire workers. He's got his economics skewed, but his hate for ricb Non-Democrats, and no I'm not separating the terms rich and Non-Democrats. Chet has nothing to say against Warren Buffet, George Soros, Theresa Heinz Kerry, and other very rich Democrats. Buffet does hire people, but for business reasons, while the others hire aides, ballot box stuffers, bloggers, and other jobs that Chet approves of because they are Democrats and believe in keeping the poor, poor, and depressing the middle class economically.
Marshall, I am happy to inform you that states that have higher minimum wages have better economies and faster payroll growth, including small business payroll growth.
Game, rich people do spend money, but we also save more of it. For the poor and middle class, a much higher percentage of their income goes directly back into the economy.
PCD: Speaking of Warren Buffet, here's a quote:
"I personally think that society is responsible for a very significant percentage of what I've earned. If you stick me down in the middle of Bangladesh or Peru or someplace, you find out how much this talent is going to produce in the wrong kind of soil"
PCD, you're not making any sense. Can you respond to my argument or not?
Thanks Jason. With your grasp of economics, I consider your words high praise indeed. Now I'll prolly fuck it up, but I'm gonna try again.
Realism,
I think my example showed the downside for too many businesses. The raise in wages forced by the state has allowed out of state businesses to undercut them. Your happy news can probably be attributed to a variety of factors, but someone's taking the hit for having to pay more than they were for labor. It might be just the owners, if they want to keep their customers bad enough. But then, I don't see where the guy taking all the risks should suffer to enrich those who aren't taking any. He'll always be forced to pay a given rate, but if due to market forces, that's considered natural. Or perhaps he IS raising his prices. Perhaps certain businesses don't have the threat of out of state competition. In any case, government interference in this matter is mostly destructive, and in addition, more time might change the fortunes of those you have in mind.
Warren Buffet's quote shows that wealth doesn't mean you know everything. Part of the reason he's wealthy is because he didn't try to sell stuff to people who are eating dirt to survive. His statement is preposterous and the result of being at the top for too long. What he needs to do is to leave his wallet at home and go live in Bangladesh for awhile. If he's any kind of business man, he'll still get something going. And most likely, he'll pay like crap until it is going. I never read his bio. Did he come from poverty? His origins might shed light on that statement.
Check out Wikipedia
The raise in wages forced by the state has allowed out of state businesses to undercut them.
In an age where the economy is primarily driven by the service sector, I just don't see this as possible. You can't call the next state over for pizza. Certainly there's some businesses that are sensitive to competition from geographically distant regions, but with massive variations in things like state regulations, etc. it's hard to believe that all the various "angles" haven't already been staked out.
If a company is being out-competed by an out-of-state business, minimum wages simply aren't a factor in that.
But then, I don't see where the guy taking all the risks should suffer to enrich those who aren't taking any.
I don't see why a worker should be forced to subsidize his employer's bottom line by working for a wage artificially depressed by the relatively inflexible bargaining position being an employee represents.
I'm sure you guys think that's some species of "marxism" or whatever, but the truth is, that's just workplace democracy. And so I have to ask - why do you guys have such a deep distrust of democracy?
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