Tuesday, September 13, 2011

Post No. 174a: Answer Us This Regarding Job Creation


It has been a while since we simply posed a question, and we thought that this might be a good time to do so again.

President Obama recently unveiled his job creation proposal. It was roundly criticized in a number of circles from various angles. The private sector "job creators" essentially took many of the jobs previously held by Americans and transferred them to China, India, and other countries where they could find workers willing to work for far less than most Americans. An argument has been made that the regulatory and tax environment here in the United States is what drove them to transfer the jobs elsewhere.

While listening to the criticism of the President's proposal, several questions occurred to us:

1. Assuming no change in regulations and the reduction of corporate and capital gain taxes here in the United States, will they create new jobs here or bring those jobs back here to the United States?

2. Assuming regulations are eliminated, but taxes remain the same, will they create new jobs here or bring those jobs back here to the United States?

3. Assuming regulations are eliminated, AND taxes are reduced or eliminated, do you think that the private sector "job creators" will create new jobs here or bring the jobs back home?

The ultimate question is whether we have a guarantee from the private sector "job creators" that if the government gives in to their requests, it will inure to the benefit of middle-class American workers.

10 comments:

  1. Why would corporations obliged by law to maximize shareholders' earnings pay wages that make goods and services noncompetitive in the world market? Dictators can control safety and other regulations (and currency) to suit themselves. They enjoy the 'small government' that the selfish and greedy among you revere.

    Does 'god' stand for small or big government? Why don't i ask that brainless comic Bachmann?

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  2. You hit the nail on the head CorfuBob. Although corporations have an obligation to maximize shareholder earning, they have no obligation to do anything to advance the interests of this country just because their corporate headquarters might be located here.

    The other issue which is of interest to us if whether, if the "job creators" somehow got the changes in our regulatory and tax laws which they seek, would they somehow be mandated or required to create those jobs for American citizens. We suspect that many in American society do not trust corporate claims that it is the government which prevents them from helping the American people and the American economy.

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  3. Welcome back Dale:

    You mentioned lots of things in your comment, and we will just focus on one of them for now, and leave the remainder for some others to address.

    Government, at least our form of representative democracy, is ALWAYS inefficient. It's the nature of the beast. Can it be made more efficient? Yes, as with all things. However, there is very little motivation for government to become more efficient, except when tax revenues are down.

    Some argue that we need to change the governance model in its entirely. It's arguably unworkable in the long run, when agencies are allowed to continue to exist even when they are ineffective in achieving results, and employees are allowed to stay employed, even when their government employers do a poor job.

    On the other hand, some argue that government has to always be there even if it is bankrupt. Should governmental entities become defunct and be phased out of existence?

    Anytime you create an expectation that your continued survival is not directly related to the level of your performance, you are going to encourage poor performance and a "good enough for government work" attitude.

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  4. We posed these on Twitter, and people actually said that the private sector job creators would definitely bring the jobs back to America if they got the regulatory and tax reform they sought. While we're not surprised that folks might feel this way, we are surprised that people think that their prognostication capabilities are infallible.

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  5. Dale:

    You mentioned that governments can create work, while the private sector creates jobs. We assume that a wordsmith like you chose different words for a reason. While we have a distinction in our minds as to the two, we're appreciate your thoughts as to the difference.

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  6. I had to laugh when the President unveiled his new job creation proposal. The only thing that will create jobs in the long run are the reduction of corporate and capital gain taxes and a change in regulations: The big corporations have to bring those jobs back, or they are not allowed to sell their crap, period!!!

    

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  7. The "job creators" would sure as hell stop creating them in foreign nations (and for illegal aliens here) if we declared American jobs to be a precious national resource and made it a Federal offense to endanger them in any way. Look, we can pass stuff like that to protect the "endangered" Carolina Heelsplitter Mollusk and the Three-Toed Kangaroo Rat; why can’t we manage to do the same for our own working people here in America?

    As for those jobs coming back: pass legislation which, by a certain date, declares all of those companies doing business in foreign nations to be “corporate citizens’ of the nation in which they employ the most workers, then levy a tax on imports as we should have done long ago . . . and just watch those jobs come back.

    To answer your questions: to make the whole thing work, why yes, of course it would require our government to show some restraint regarding taxes and regulations (and to bust the unions). But the plan described in my first two paragraphs would provide some desperately-needed “insurance” to cinch the success of the overall objective.

    The Independent Cuss

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  8. We have a somewhat different view on this issue Wsteffie, as reflected in the questions we posed. It is our experience that for-profit corporations do whatever they can to increase the bottom line, and that's what they are designed to do. They are not vehicles designed to advance or consider the public good of the United States, while they may derivatively provide such benefits. Their mission is to make money for their shareholders - as much of it as they can.

    That being said, we strongly suspect that will continue to support lowering the corporate tax rate, and a reduction in regulations, and IF those goals or achieved, they will still manufacture their products in the country where the worker wage rate is lowest, along with the lowest capital and operating costs.

    Why shouldn't hey? Corporations are not patriotic. They are legal, business, profit generating vehicles. The Independent Cuss' argument is somewhat different.

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  9. Independent Cuss, we applaud your creative thinking approach to addressing this problem. (We're referring to the declaration of precious national resource and enactment of penal and/or civil provisions for national economic endangerment.)

    However, that will not happen in our life times, unless we are in the midst of war, and a federal national emergency or martial law is declared. It smacks too hard in the face of freedom, which is the dominant, purported philosophical theme of this country, despite our experience with slavery, and the fact that we lock up one of the largest percentages of citizens by a state on the globe. (In reality, the theme really is "You can do whatever you want to do as long as the powers that be don't disagree with it."

    You've hit the nail on the head in characterizing your plan as "insurance.' There will never be any such "insurance" in the U.S. in the foreseeable future. Once again, private corporations were never designed or created for purposes of serving the public good. If the public wants to create such entities, they are entitled to do so.

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  10. ‘Spector,

    I stand by my position. I shall quote from the U.S. Constitution, Article 1, Section 8, Clause 3: “The Congress shall have power to regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes.”

    And there is not one doubt in my mind that the “free trade” disaster, by which we have been sold out by traitorous leaders from Nixon up to the present, was precisely the sort of nightmare which the framers had in mind when they wrote it.

    My concept is in fact Constitutional and in no way contradicts any aspect of American freedom . . . except to prevent self-serving politicians and corporatists from continuing to commit treason by perpetuating a trade imbalance with hostile foreign nations.

    The Independent Cuss

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