A study of love, hate, pain, and joy.
For the folks who hover at the far-right end of the political spectrum, I have a question for you.Oh, I know your usual MO when it comes to 'defending' your political views- the insults, the denigration and all of that juvenile stuff.But maybe, just maybe for once you could answer honestly without all of the make-up and costuming.Here's the deal: Yesterday the GOP rolled out the "Jobs Through Growth Act.” They said of their plan, “We were tired of Obama campaigning around saying we don’t have we don’t have a jobs plan when we’ve had one for nine months,” Sen. Paul said. “So we codified it into a bill.”Here's my question to you, gentlemen: Can you tell me how the 6 main proposals of this act will actually put Americans to work?Let me summarize the 6 proposals for you:1. Cut “job-killing regulations”2. Add a balance the Budget Amendment to the Constitution;3. Line Item Veto for the President.4. Reduce corporate taxes;5. Reduce the top tax rate to 25%;6. Repeal Obamacare.There they are. According to your GOP, these 6 proposals will open the doors to many more American jobs. Further, could you estimate about how many more American jobs each would create- rough guess?I'm having a hard time trying to figure out how each one of these proposals help reduce our jobless rate.When you comment, could you use this template and, for each of the 6 proposals, tell me how each will lure more American workers into the workplace?220.127.116.11.5.6.
Mud, You and I have tried to dance before. You will recall that you refused to agree with a very simple truth - but hell, I'll try again. 1. Cut “job-killing regulations” - John Stossel did a program the other day and used a cart to haul in the 80,000 pages of new regulations that have been published this year alone only by the Federal government. The consequences of those regulations are huge and some carry penalties, even criminal penalties - who can even read all that? One simple example - the recent requirement in Obamacare (fortunately repealed) for businesses to create a 1099 form for every transaction of $600 or greater. How many of those do you think occur each day? Creating, printing, storing, cataloging, mailing, and accounting for all those forms is huge. Congress did that with a stroke of a pen with no thought as to the ultimate cost. Next example - An Exxon oil guy pointed out the other day that a new well could require up to 35 different permits before then could even start drilling. That's patently absurd. It ties businesses up and sidelines projects that could employ millions while we wait for bureaucrats to approve projects that they typically don't understand. 2. Add a balance the Budget Amendment to the Constitution. The interest payments on the US debt on a rolling 12 month (Sept 2010 to Oct 2011) cost is: $454,393,280,417.03 (according to the US Treasury). In more personal terms that's $1465 for every man, woman, and child in the United States. For that staggering amount - we get exactly nothing, NOTHING. It's simply an interest payment. We've allowed the government to run up a bill that we might never be able to pay - it is completely irresponsible regardless of who did it. That $454,393,280,417.03 doesn't hire a single person, it doesn't purchase a single product, and it doesn't create any value for a single citizen. We need to whittle that payment down as fast as possible so that every dollar that goes to Washington does something good. 3. Line Item Veto for the President. The thought process here is that a fiscally prudent and courageous President (if we were to find such a person) could carve out the wasteful earmarks and additions to all manner of bills. Politicians view any bill as a potential vehicle for spending. I have a problem with this constitutionally, but it is a good solution for 1800 page bills. The real problem however is the nature of earmarking itself in that it uses public money to essentially bribe Representatives and Senators to do the wrong thing. Obamacare is a good example of a bill that might not have ever passed had there not been the kick-backs and sweeteners. So someone might say "That hospital for Connecticut was only $30 million" but the Senator was essentially bribed to destroy the budget and the Constitution while taking over 16% of the US economy with his vote for Obamacare. A President could eliminate that waste. I'm probably at the raged edge of the word count and I do have work to do. I'll see how you munch on that before I decide to spend any more time on your challenge.
Mud challenge Continued: 4. Reduce corporate taxes; This has worked every time that we have tried it. We are punishing our corporations with the highest tax rate in the free world. If you reduce the amount of money that you take from a corporation, no matter what they do with the resulting cash it will benefit a broader span of people than anything the government could do with the same money. The case automatically get reinvested in the economy whether it is paid out to employees, reduces the cost of a product or service, or is reinvested into the business. Only the growth of business can get us out of this hole. We need the same kind of growth that Ronald Reagan created. Within months of taking over the Gross Domestic Product soared. It was up and down for about 3 years and then stayed positive for the next five years some quarters flirting with a growth rate of nearly 10%. 5. Reduce the top tax rate to 25%; President John Fitzgerald Kennedy "A rising tide lifts all boats." He was right of course. Look again at the Gross Domestic Product that was in decline when George Bush took office in 2001. It went down one quarter, up the next, down the next and then stayed positive all the way until first quarter 2008. The GDP grew in every quarter of George Bush's Presidency except two of the first four quarters and three of the last five. Tax cuts work every time - JFK knew it. 6. Repeal Obamacare. This is an anchor on the economy as it effects every business and it's a cloud over all Americans. The only cost effective way and the only fair way to provide health care is to allow the free market to flex its muscles. The Federal government has been screwing with health care for my entire life and the costs have soared. The Federal government hasn't done anything in more than 50 years that has bent the cost curve of medicine down. Mandating tests, "free" visits, is a huge cost to everyone who is paying the costs which is around 53% of us. Replace government plans with individual medical savings plans and people would shop around for a good price. There is a huge cost to 53% of us in mandating that children remain on parent's policies until 26. Let them get a job like the rest of us. Had Obama passed tort reform instead of this monstrosity that is Obamacare he would have gone down in history as a guy who actually did something positive to bend the cost curve. As it is, whether the courts strike it down or a Republican President gets rid of huge pieces of it starting January 2013 - it's gone. The President announced today that a central part of Obamacare the Community Living Assistance Services and Supports (CLASS) program has collapsed and is unsustainable. DUH - 56% of Americans knew that when the bill was passed against their express will. CLASS is just the first part to fail - the rest is right behind it.
CS- thank you for taking up my challenge. Right now, I don't have the time to look through your comments, but I will later on.
Mud, It's an opportunity to prove that I did take a flight of economics courses in college. I should have proof read closer though - there are a number of typos.
CS- #5- Is their anyway too ensure that American companies will reinvest in American jobs. Call me prejudice, but I'm to the point where I'm thinking, Let's get America working, fuck everyone else.
Johnny, The very best way to ensure that American Companies (and every other company) invest their capital in the United States is to lower the personal and corporate tax rate below that of other Nations. If the United States lowers its personal and corporate tax rate below all the other members of the G-8+5 - the result would be an immediate flood of cash, business, and jobs of epic proportions. It is really that easy. Our government has to stop screwing around with business and free it. No special tax credits, no subsidies, no grants, and no more loans. Start slashing regulation, expedite permits, leases, and licenses. No temporary credits or tax holidays - make it permanent to create a predictable environment.
Thanks for your patience, CS. I have not been blogging in several days due to other responsibilities. Thank you as well for your straight-forward answers.I was going to begin with #5 as did JOB. There's the sticking point. Why would some company/corporation/business WANT to invest in American jobs when all of the 'right' conditions for bottom-line improvement exist off-shore?I believe there's the question that needs to be answered. CS noted just above that one of the impediments that business stumbles over is slashing regulationWhich 'regulations' ought to be slashed? Surely not health or environmental regulations?? I hope, CS, that these two are not on your or their list. Whereas 3rd world countries don't give a rat's ass about health, safety and environmental regulations for its citizens, the citizens of the Unites States are not going back on protecting our own people.I'd like more information about this line as well, CS-- Our government has to stop screwing around with business and free it...and no more loans.If banks are not willing to loan small business loans without making the businessman jump through dozens of hoops, then who else can an entrepreneur turn to except a government-backed loan? How does this practice 'interfere' with businesses creating jobs? Seems to me that if it is a loan and not a grant, then it is a win-win proposition.Let me ask you about this one as well:If the United States lowers its personal and corporate tax rate below all the other members of the G-8+5 - the result would be an immediate flood of cash, business, and jobs of epic proportions. It is really that easy. The current 'stated' corporate tax rate [without all of the special loopholes granted for political payback] has been the same for the past 11 years and only slightly higher than they were in 1988. Altogether, the rate has been essentially steadily at the lowest levels for 23 straight years.Check out this table:http://visualecon.wpengine.netdna-cdn.com/wp-content/uploads/Income_Corp_CapitalGains_Rates.pngNote further on this table that capital gains tax is at a historic low. Not only are they at historic lows, but as you know, in 2003 GW Bush set the tax rate on long-term gains down to 15% and Obama kept it there. As these charts show, for the past decade or longer, American businesses, corporations as well as individuals have enjoyed historic low taxation requirements. The question has to be asked-- where was the job growth during this decade? Ten straight years of goodies for business while our nation watched millions of jobs disappear.You can't tell me, CS, that if we just lower taxes a little more for them, that the result would be an immediate flood of cash, business, and jobs of epic proportions.You may have more experience in the business field, but logic might be on my side.
Mud, You have asked several questions - we'll start with regulation - there is a mythology that our lives have been made batter somehow by regulation. As you point out third world nations don't care and neither did the United States until the effects of problems began to be felt. Workplace accident rates began to plunge long before OSHA and water ways and air was cleaning up long before the EPA. The government is always a day late and a dollar short. It doesn't take any effort at all to look around you and see things that the government has done to make manufacturing more expensive or more difficult with no discernible value. Just look around you - you'll find dozens of things in your house that have been victimized by well meaning but ignorant bureaucrats. All of that adds cost or complicates production. Ask yourself this - why is it that the most regulated industries that we have are the ones who fail? Banking, Telecommunications, Automobile, etc.? The worst part about the current system is that this huge Federal bureaucracy is cranking out tens of thousands of pages of regulations unchecked. No review. No costing and no analysis. Automobile mileage standards is a great example of something that drives industry to unnecessary technological feats that provide no value for the nation or the consumer. Indeed they are endangering countless American lives by building stupid little cars that are not survivable in a crash. Think about the requirement to put detailed food ingredients on packaging. There is a cost to business to make them put something on the side of their packaging that no one reads. If it was important to people and they wanted it - businesses would do it to discriminate their products from their competitors. Most government regulation is unnecessary, counter productive, and often dangerous. The best thing that the Federal government could do is stop all regulation at the Federal level. Replace that with a body that would evaluate regulations in the States. A valid use of the commerce clause might be to even things out so good ideas in States get exported to the rest while bad ideas (virtually anything in California, New York, and Oregon) get eliminated to simplify interstate commerce. All you have to do is eliminate conflicting health insurance requirements between the several States and we could save billions. Put your environmental hat on - 80,000 pages of regulation by the Federal government this year alone. Extrapolate that by multiplying out all that billions of pages, barrels of ink, and the translations into Spanish, Vietnamese, Urdu, Russian, Greek, Chinese, and French. The simple cost of just publishing that crap is staggering. And the simple truth is - nearly all of it is unnecessary.
Mud, Second issue - "no more loans," -- No more GOVERNMENT loans. The government does loans badly, they pick the targets for all the wrong reasons, and the process is fraught with cronyism and patronage. In short it is a incubator for corruption as the myriad "green" loans of the current administration proves. We have an amazing financial system that can and will provide all the money required for good ideas.
Mud, Corporate taxes - what you said about tax rates is essentially true, but it is also irrelevant. The specific question my comment responded to was "How do you keep money in the United States?" The answer is lower tax rates. The US tax rate is important as it relates to other G8+5 tax rates. If the US tax rate remains the same, but other tax rates are lower - our businesses are at a disadvantage. Money is fluid and it will move to where returns can be maximized consistent with risk. Again - I would eliminate ALL loop holes, subsidies, tax breaks, and outright gifts to corporations and then lower the tax rate below the level of the members of the G-8+5. It will help in two ways, businesses will soar as will tax revenues. It may seem counter intuitive, but not only did our economy grow quarter after quarter after quarter after the Bush tax cuts, but revenue to the government also grew. Cut taxes - revenue to the government grows - it is really that simple.
Mud, Your logic won't trump actual proof. We live in a Global economy - there are plenty of places for money to fly to if our Federal government makes America a hostile environment for cash. Just ask New York, California, Michigan, etc. - there's always Texas, Virginia, and Florida. Same principle.
CS- I appreciate your straight-forward answers even if I may disagree with them. Here's one that might need clarifcation:there are plenty of places for money to fly to if our Federal government makes America a hostile environment for cash.Of course, business will seek to locate in the best economic environment that they can find. But how can Michigan, Ohio and other states offer such places when Bangladesh, China, Vietnam and Thailand will sell their very souls [and their health, workers and land, water and air] to get the jobs?Surely you do not suggest that we here in the U.S. roll back health, safety and environmental laws to the 1930's, do you?The U.S. will never be able to compete on a level playing field with nations like those listed above. We Americans have lifted ourselves way above the 'standards' set in those 3rd world nations.Trade agreements are our biggest jobs threat. When we allow China to dump their crap onto our shores with no restrictions, then we kiss American jobs goodbye.
Mud, Q: But how can Michigan, Ohio . . . to get the jobs?A: The circumstances under which a corporation would or would not locate to Michigan or Ohio are complex to be sure. We were talking specifically about investment capital and my answer remains valid. We could all think of a myriad of reasons that would encourage businesses to locate to a specific country or State - that materially expands the discussion. However in the area of capital - it has been widely reported that a couple of trillion dollars in capital is sitting on the sidelines right now. That is circumstantial evidence that investors are waiting for America to get over it's current flirtation with socialism. The best way to conduct commerce is in complete freedom - you will disagree, but that is true. You interject social responsibility and there is a place for that. You also bring up the element of risk in doing business in other nations. And there is an issue of fairness. All of these things influence business and the interference of government into the free market. Many things other than our government effect the willingness of businesses to do business in a foreign country. Stability - will that government fall into bad hands and Nationalize the business? Generally a corporation would prefer to do business in a stable, predictable environment. America under it's current leadership is neither. Regulations - a business in Mexico can operate a truck under regulations (or not) that are vastly different than ours. Our government has a responsibility to ensure that Mexican trucks that have not been maintained to our standards don't cross the border and jeopardize our citizens on our highways. However if Mexico monitors it's fleet of civilian trucks at the same level as we do, there is no reason to make those truckers jump through hoops to deliver their cargo. You will disagree, but corporations have developed a conscience for the most part if for no other reason than to prevent public affairs nightmares. Coach can't afford to have pictures of Bangladeshi children slaving away for pennies making $150 purses for women in New York. However they also can't afford to build a plant in Michigan where some union thugs will organize the work force and drive the price of that purse above the competition. Gucci will just make their purses in Texas and eat their lunch. If the Federal government makes Texas toxic - they will go to Vietnam. Coach also can't afford to deal with environmental and animal "rights" whack jobs. America has become a place where Coach might clear all of the regulation hurdles to build a factory and then have some nit wit judge halt production because PETA maintains that the leather comes from cows killed without being anesthetized. That is the ridiculous environment that we find ourselves in today. Finally, we don't want our children and grand children growing up to stitch purses together. If a purse can't be made economically overseas and women still want purses, some entrepreneur will build a machine to do it. The free market will prevail - screw with it and unintended consequences will defeat you. There are some safe guards that we should put in place. The Airbus is made by EADS and they are advantaged by European governments. You could make a case that we should charge tariffs on Airbus purchases to protect Boeing's market - but that can be a slippery slope. Europe may counter with tariffs on Dreamliners and you still might not be able to effect deals outside our reach (China, Japan, Abu Dhabi, etc.). Free is best with carefully and minimally applied regulation and government. Americans have not been "lifted above" third world nations by government or regulation - the wealth of this Nation has been created by the free market. What the government used to do with a light touch was create the environment for it to flourish.
Mud,In a strange twist of normalcy, I am going to agree with you and disagree with CS. I am 100% opposed to "free" trade agreements, which have support in both parties. If we and by we I mean all US citizens, want to earn a living, we have to keep manufacturing jobs here. I disagree with CS that we don't want our children growing up to make purses. I want my children growing up with a great work ethic and an enviable pride in their work. I would rather my children grow up to make purses, and be proud of what they accomplish, than to be a rich defense attorney and be ashamed of what they did to get rich (Jose Baez, for example.)I guess its nice to see you're not a complete opposite - maybe there's hope for you.
Nope - Free is best and government should only intervene when necessary. It is necessary, but since government is so bad at selecting when, where, and how - it should be judiciously done.
Mud, You don't seem to have your heart in this. It isn't easy having this kind of discussion - is it?