The White House held a summit Thursday on how to create jobs in this economy. I have a plan that can do it in four easy steps…
Posted: 12|4|09 at 7:16 am by Abdul Hakim-Shabazz
Follow this entry via RSS 2.0.
Comment | Trackback
Yes. Please. If you concur with Abdul, perhaps you'd like to share these ideas with our Indiana Senators that may vote for Federal taxing and spending associated with expanded health care or Afghanistan:.Senator Bayh: 554-0750Senator Lugar: 226-5555.or you can easily look them up online and submit comments.
Never has a post been simpler or more correct. Readers and posters on this blog are much better informed and would love to find someone who can disagree and make a case for any other solution.
The government can only do things that stifle job creation. It cannot create them.
It may redistribute tax dollars to incent hiring, but that is not job creation, either. That is merely a variation of more conventional welfare programs. When the money runs out (and it always will), the people again will be without a paycheck.
Real job creation comes from business owners seeing a way to increase their net profit by putting more people on the payroll. When that happens, the employees stay hired indefinitely and makes it likely even more will be hired as time goes on.
I am reminded of the 'teach a man to fish' proverb.
The government can never accomplish more than the 'give a man a fish and feed him for a day' part through its active participation. It can only achieve the 'teach him fish and he will feed himself for life' part by staying the hell out of the way and letting him fish.
Government officies seem to think they need to hold the pole and give the fisherman bait IT bought with the fisherman's own money. Of course, when they quit doing that (and they will), the fisherman will again go hungry.
I would combine #1 and #2 into one item to demonstrate that you can't have one without the other. Otherwise we just get another Bush.
Step Four isn't needed. Those who watch tend to be elected officials who only take credit for when times are good and can do next to nothing when their thievery becomes too much for the economy.
Imagine how many jobs we would have created in Indiana had we repealed property tax and replaced it with a TRANSPARENT and FAIR form of taxation? That's what tax activists suggested in 2007. Legislators even laid out a plan to elminate homestead property tax.
Instead, we got higher taxes and more lost jobs. That means less income to pay the higher taxes.
And the caps? That's just another political trick so they can keep taxing our property.
What's really wierd is, just now, the sub host on Limbaugh just uttered what I wrote over an hour ago – 'The government can't create jobs, it can only prevent them.'
We should have voted in Ron Paul as President. He is one of few people who actually practices what he preaches and lives by this very economic credo. Ron Paul is so popular now, he was on 5 different programs yesterday: CSPAN, FOX, MSNBC, CNBC, & Bloomberg. I am a life-long Republican and am a big fan of Ron Paul and will no longer support Mitt Romney or John McCain or these other jokes we have in office now. I would also love to see Mayor Ballard go, Carl Brizzi resign, and Tom Johns get raped by a goat for being a total asshole and embarrassment to our city. Also, let's get rid of Dickhead Lugar who votes for LOST treaties and will not support SB 604. That's my take, but who cares what I think cause I'm anonymous pulling off someone else's internet and using a proxy to hide myself cause I know Abdul is in bed with most of these losers I listed above (with exception to Ron Paul).
Had they repealed property tax, just think of all the interest in investing in Indiana there would be.
I find it ironic, Abdul, that the president you support is diametrically opposed to all of these proven solutions.
RICO, I find that to be ironic with you.
Government is too big to succeed.
I'm with you on almost all Abdul, except the cutting taxes thing. We tried it eight years ago. And five years ago. And again 19 months ago. It failed miserably….because the cuts were aimed at a spectrum too narrow to consider anything but greed. The facts don't lie.
There is a time and place in every economic cycle for tax cuts….but it isn't now.
I'd add one thing, Abdul: we need to insist on a FAIR trade policy with all nations. We don't have it anywhere. And time's a wastin on that score.
This insane trickle-down nonsense has led to one thing: a worldwide economy, supported by Reagan through Clinton and both Bushes, which systematically deports jobs to cheap labor nations.
And in the interim, we've raised about 1.5-2 generations who believe it is their God-given right to a $499 50-inch flat screen. Good bye Magnavox in Ft. Wayne. Ditto Zenith and RCA.
I don't typically favor isolationist practices. It's too Xenophobic. But we've been the world's trading patsies for almost 30 years, and it has succeeded in only two things: cheap goods, and a breakup of our economy. We don't MAKE anything any more.
We need to insist that all trading partners engage us fairly That is, if we don't already owe them so much that they can flip us off.
Maybe someone smarter can answer this simple question for me.
A business has a trinket it sells. There is a demand for 100 trinkets at $50.00 It requires 2 full time employees to make.Taxes are 40%Cost are $25.00 ( includes everything direct and indirects)
Revenue – $5000.00Pre tax profit of $2500.00
Taxes paid – 40% of $2500.00 = $1000.00
Net profit for business – $1500.00
If you lower the taxes to 30% = $750.00
Total profit for business rises to $1750.00
Please tell me what that does for job creation and demand?
While I understand everyone want to pay less taxes. I do also, but I am not convinced that higher taxes stiffles job creation. Nor does lowering taxes by the will automatically kick off nation wide job creation.
People always scream about smaller government, but only if they cut the government money that supports someone elses job. Soon as you start cutting something they care about then it is a different story.
We all know the majority of the government spending is with the military. Talk about cutting that then people scream that you are unpatriotic. To me it is still government spending.
While I would like more jobs to be created, haven't we already seen that cutting taxes doesn't really stimulate job creation at all.
Now my example might be flawed and you are more than welcome to blow holes in my reasoning. Until now I haven't heard any reasoning to make me change my mind.
Think Again…you are wrong! We DO make something here in America. We make DEBT!
I would be intrigued as a follow up Abdul as to exactly what kind of jobs will be created? The biggest job creater in Indiana over the last few years based on that philosoply is Wal Mart. Now I am not taking a shot at Wal Mart it's just as TA said we don't make or build anything anymore. In the past manufacturing has always brought us out of a recession. The dollar loses value our products become cheaper and exports go up, employment goes up, profits go up. But now we are just stuck thanks to NAFTA and CAFTA……so it's going to take more work then just lip service.
How about getting good at something and make your own job? Find a niche… it's America isn't it?
Good deliniation on the need for both tax cuts and trading policies to be even-handed. However, I'd go a step further and suggest don't implement tax cuts until we lessen the debt/deficit, and to provide perceived equilibrium for the spending cuts that have to come. .There's never been a better time to “buy American” either, if you'd like the other guy to buy YOUR goods and services.
The state cuts have moved on to higher education. The reality that lies ahead may cure our notion of those God-given flat screens.
Insanity is the idea that institutional gluttony should continue & that taxes can't be “cut.”
Jerry, here's a reality check:
I did find a niche and create something. In 1979-82. That job went overseas to $.50/hr. workers. I retrained.
The “new thing” I made lasted until 1987. Same outcome. I retrained. Got another master's and entered business for myself. Still at it.
All around me the folks who use my services, are seeing hours cut, jobs eliminated and incomes decreased. And in almost every single case, the grief is a direct result of shipping jobs overseas. It's not just manufacturing–Hell we don't even answer our own phones any more–there are call centers in India to handle AT&T's calls for God's sake. And Comcast. And GE. And…well, you get the point.
I never minded trading with foreign nations. I expect job protection to be a major foundation for any trade relationship. But as with most government actions, the free traders, initially led by Reagan but now backed by nearly every political faction in the nation, have let the pendulum swing so far out of whack, that the fix is decades away.
We'd better get used to being a fractured economy. It isn't going to get better soon. Those who dined at the Trickle Down table are now getting dumped on. I will give George Herbert Walker Bush credit for this–he initially called it Voodoo Economics.
And as someone who came from a New England patrician background, he was flat-out right. Then he wanted power, so he swallowed his pride and honor, and became VP for 8 years.
And so it went, and so it goes…
No disagreement on the overspending of modern Republicans. But, the current poster child for this malady is a guy who would really bring out my prior labels of hater, racist, and xenophobe. The fantasical notions of universal home ownership, handing defaulted companies to workers instead of those risking their money, quadrupling the deficit Bush Jr. left us, and fixing the economy through expanded government make it clear our problem is bipartisan. .Actually, our problem's in the mirror. We need to participate as citizens, particularly in our local community. You won't have to look far. There are schools in bad shape and getting worse, kids that need adopting, and plenty of places we can make a difference. I know TA pitches in. I know I do. I know there are a lot of people that do more for the community and nation than either of us. But, if we are all volunteering to our community in some capacity, I think we'd pay more attention for whom we vote. We have more “skin in the game”. Party could, would and should matter less..That's my quaint notion, however idealistic it may be.
It's not quaint. It's the way it was when I was a child.
Every 50s-plus generation in history arrives at the same conclusion: we need to “return to our roots” somehow.
I'd part paths with you, Taxpayer, reagrding this president and his goals. The vogue economic policy since 1980 has been a lopsided benefit-gain equation. You simply cannot do the following things concurrently and expect the economy to respond favorably:
1. Cut domestic spending 20%2. Increase Pentagon spending likewise.3. Cut taxes across-the-board; then whack out capital gains, too.
The above philosophy panders to the far right; it is, as GHWB said, Voodoo Economics. I favor most of the above components, but when Reagan did them at the same time, the economy tanked within 18 months. Harken back to the 1982 elections…which was, for the record, the last time Dick Lugar got a serious challenge.
The sad fact is, too many neocons survived the Reagan years, and infiltrated think tanks, government, biz, and the rest of the real world. The Rummys, Cheneys, Wolfowitzes and their ilk cannot be faulted for honestly believing their economic theories worked.
The crashing relaity is–it didn't work, and still doesn't. In our household budgets, when we face difficulty, the smart ones among us cut spending as quickly as possible. We make choices. Government has sterner obligations and commitments, but it too can start to make those choices, which cross party and ideological lines.
We can help ourselves best by pitching in as Taxpayer advocates. We can also insist that government–at all levels–do what our governor is doing now: severe cuts. Without that slap of reality, we're further lulled into complacency.
And the problem with complacency is, when it lingers around for more than a year or so, it seeps into workaday life. What was out of bounds two years ago, spending-wise, is now “sacred cow.”
Universities got the real news Thursday. I hope the governor told them: cut spending 6%, and get ready for more, and don't you dare make it all up by tuition increases.
Now, if only the Pentagon got that news. And higher ed everywhere. And multiple other sacred cows that need slaughtered.
Hey, I can hope, can't I?
Sounds like we're agreeing on most of this. But, that must mean we're drinking from that same well that Speaker Bauer recently discovered before proposing ethics reform..The world just keeps getting scarier.
How does cutting business taxes spur job creation and demand?
Two main ways – One – more people are willing to take a chance and start their own business if they think they can make good money doing so. Why take a risk and try working for yourself if the only one that makes money is the government?
Second – if a company has more profits, that means it also has more money to expand. Maybe your fictional company can try making a second type of trinket. Or maybe it can see if it can open a second store to sell the same trinket in a new location. It all comes down to the cliche – “It takes money to make money”. Of course any new employees hired because of the expansion will now have money that they will want to spend at other businesses.
There is no guarantee that business owners would choose to expand if their profits went up. It is possible they could simply pocket the difference. If that happens, they will either save the money or spend it. If they spend it – they are increasing the demand for other companies. If they save it – that is money available for banks to loan to others (at least in theory – in today's economy banks have been reluctant to loan out money).
I am one of the people that is absolutely against cutting military spending while we have men and women in harms way. If you can find areas to cut that do not affect soldiers in combat – maybe. But only if there was no chance the military would have to shift funding in such a way that it does affect soldiers in the field.
FAIR trade as in NAFTA as in Bill Clinton, NOT RR, bad think again selective mis-memory. Mike, trinkets caught on. Girls loved them and you. Demand is now 1,000 units and climbing weekly. What are you going to do? If you stay with the two employees you invite smarter competitors than you to enter the trinket market and take your market share (and all your new girlfriends) away. I suspect that my manufacturing experience exceeds all the posters on this small forum. When the USA was a closed economy any number of political stupidities could be engaged in and were. Once the doors were opened, however, the gods of the marketplace began to hold sway and the idea that the regulatory state could impose 25% costs just by fiat with no value became unattractive to domestic producers and an entering wedge for any foreign manufacturers NOT SO similiarily burdened. Exiunt jobs. Exiunt know how. Exiunt capital. Enter bankruptcy. Enter devaluation of dollar. Enter repudiation of debts-sooner or later.
Not a problem for me Jerry I am doing very well thank you. I am pointing out factual issues vs hyperboyle….and your point is?
According to a Robert Samuelson writing in Newsweek, maybe two months ago, the rough percentages in the 1960's were 60-something percent on military, 20-something percent on entitlements. These days, those numbers are reversed.
Unless someone wants to cite a source to refute those numbers or my recollection of them, I'll simply concur that getting out of Afghanistan and eliminating duplicative military spending is a necessity. However, the elephant that is now in the room is our entitlement spending: present, future, and what's being proposed and debated this very hour. It is also not affordable.
TA – another way to look at things is how much worse they would have been without the tax cuts.
Also, considering the economic consequences of cheap exports, there is a whole discussion we could have on this topic; but …
Someone buying a $499 50-inch flat screen might not have bought one at all at $1099. So, somewhere, some store employees, wholesalers, shipping folks, etc… made some kind of money.
And for those who would have spent $1099 on one, they now have $600 more to spend in the economy on other things. Even if they blow it on Starbucks coffee somewhere, it generates additional economic activity.
We absolutely need to make more things in America; but, until we get massive restructuring of the tax codes, get our currency stable, cut red tape and government intervention in the economy it is going to be difficult. We currently sport the 2nd highest corporate tax rates in the developed world (corporations don't pay taxes, you know, they just collect them from ordinary people in the prices of what they sell).
America is no longer so far ahead of everyone else that we can succeed 'despite ourselves' … we must be competitive in the market for factories and labor.
BUT, the politics of tax cuts needs to end as well. Sure, a 10% cut on somebody making $30,000 a year is only $3,000 when a 1% cut on somebody making $500,000 a year is $5,000 but that doesn't make it fair to call the cuts “for the rich” as often happens. And, besides, that $5,000 a rich person saves is used to either (1) create economic activity directly, (2) invest in companies that hope to grow and create jobs or (3) is saved in a bank which provides funds that can be lent to start up businesses or to people who are buying a house or a car [also known as "spending by other means"].
There also has to be an acknowledgement that government can't provide everything to everybody. In fact, it is often quite harmful when it tries to do this [great example is how medical care costs more than twice as much as it should due to government intervention in the marketplace, which causes people to call for government to fix the problem it created and it will then try to do so and make things even worse]. Or how about the dept of Energy and their $20+ billion a year budget and 11,000 employees – all working, supposedly, to get us off of foreign oil since the Carter administration. At what point do we say “FAIL” and try a different approach?
What does the business do with the profits? Do they use the extra money to expand? Does the owner use it to create economic activity by building a bigger house, buying a boat or a nicer car [which generates jobs and commissions and whatever else for others]? Do they use it to hire more people? Increase product quality? What about using those profits to reduce any outstanding debt that could jeopardize the business in an economic downturn?
What is government going to do with the money? Build a bomb to blow something up overseas that then has to rebuilt using more tax money? Transfer the money to someone who might spend it, but has no interest or ability to use that money in ways that generate ongoing economic activity? Maybe use it to buy off a foreign dictator?
Cutting taxes does indeed stimulate jobs; but, you can't look at that by itself, you must consider the whole economic picture. Amount of regulation, level of government spending, peaks and troughs in the business cycle, value of currency, levels of employment.
Certainly increasing taxes does not create jobs, factories, new inventions or an incentive for anyone to headquarter their company in a region where the taxes have been increased or are high.
Keep in mind that NAFTA and CAFTA are not “free trade” agreements, they are “managed trade” agreements where governments have not agreed to free and open trade and markets but to pick winners and losers.
It's also worth noting that free trade in the correct sense is difficult to work when you are not competitive from a tax or labor perspective. Another example of where politicians get in the middle of what should be a free market economy and try and tinker with it in ways that create distortions and uncompetitive biases. None are so omniscient that they can centrally direct economic activity and it is sheer arrogance to presume one (person or group) can.
Your analysis of history is a bit flawed. When Reagan took office he inherited an terrible economy and the choice was made to fix it quickly versus let it linger in he doldrums ala FDR.
So, yes, things got very bad over the course of 12-18 months but then by the end of 1983, everything was turning rosy again. This compares to activities that government often undertakes that make it sound like they are doing a lot, but ultimately just prolongs the pain.
There is a great YouTube clip on the 1920 or 1921 recession (that most have never heard of) that I think features Tom Woods. Look it up and watch that. We all know about the “great depression” because Hoover and then FDR took actions that just made it worse and made it last longer than it should have – we still feel the economic pinch from FDRs programs today and those, combined with Johnson's will ultimately be our undoing I fear as the debts mount and cannot be paid.
JHC you would put any comment on this website to generate hits. Pathetic.
Hi, I think your website is interesting very colorful. Good job! I feel helping job seekers finding their ream home jobs are a fulfilling quest. Good luck in your quest too.
Its all about chasing shadows.By that I mean latching on to this or that latest, most innovative idea that some self styled money making guru has put out in the hope it’ll go viral and make them a lot of money off the backs of all the headless chickens who will follow them blindly down a blind alley. Its a shame but a truism nonetheless that people will follow where someone they see as an expert leads. Even if they lead them to certain disaster, which is what most of the gurus tend to do to their flocks. The trick is to recognize a shadow when you see it!
Copyright 2007 Indiana Barrister | Entries (RSS) | Comments (RSS) | Log in