A national referendum on the economy went badly for incumbents on Tuesday, but there's a clear way for the President to be true to progressive values and regain the political momentum. It's time to "out-jobs" the conservatives.
I imagine my anxious, unemployed aunt looking up at the TV from the dishes she's washing to listen to a candidate projecting fear and frustration and saying, "yes, he gets it." On the campaign trail in a frightening economy, a candidate who echoes voters' negative emotions doesn't have to get to solutions. That's why if you were one of the 4 out of 10 Americans feeling more economic pain than two years ago, you voted Republican. It's also why President Obama will not prevail if we are still near 10 percent unemployment -- or worse -- in 2012. Luckily, the right thing to do for my aunt and people like her is also the best thing the President can do to ensure re-election in 2012: put Americans back to work.
"But we tried that," Democrats say. "The Republicans watered down the first stimulus and then blocked subsequent ones. And now the American people have sent a clear message that they don't want more government spending." Wrong. The American people want jobs, jobs, and more jobs. Yet the President's party has failed to make the simple case -- made effectively even by many conservatives, from Reagan's chief economist to a Wall Street CEO -- that spending is essential to creating jobs in the short-term. Astonishingly, Democrats in Congress are saying that it's time to cut spending. At 10 percent unemployment. They really are, even though pulling money out of the economy is the most certain way to damage it further and a further-damaged economy is the most certain way to damage their own prospects in 2012.
Don't get me wrong; I believe the election has a lesson for progressives. It's just that conservatives actually ran on two issues: jobs and deficits. The scary thing is that of these two, the President and his party may wind up earnestly adopting the one that is less politically powerful and downright economically dangerous: the deficit. It's a terrifying "only-in-Washington" scenario, but it doesn't have to come true. Instead, progressives could bring laser-like focus to jobs, putting forward bold plans like a national jobs bill to remind Americans what they get when the government spends. A jobs bill -- not a complex indirect stimulus bill, not something that the conservative message machine could turn into a "death panel" -- but jobs, plain and simple. Making things. In America. My out-of-work aunt could look up from clipping coupons to see her President offering a job rebuilding the country she loves; and watch in subsequent horror when conservatives in Congress try and snatch that job away.
And conservatives would most definitely snatch it away, screaming that a jobs bill will raise the deficit. But they'll have to admit that their only jobs plan -- more tax breaks for those they've begun calling "jobs creators" instead of "millionaires, billionaires, and multinational corporations" -- will raise the deficit by much, much more. That's the problem with conservatives' campaign promise: their narrow economic agenda means that they can't, cannot, deliver on both jobs and the deficit. They'll have to pick one, and for them it's not really a hard choice. By picking the deficit, they will prolong an economic recovery in order to campaign against Obama with it in 2012. Sticking to their anti-tax, anti-spending guns even though it cripples the economy is a gimme... it's a twofer.
Yet this shouldn't be a hard choice for the President and his party, either. The party of working people should find it easy to stand up for the 15 million middle-class Americans who lost their jobs through no fault of their own. The party of reasoned policy-making should find it easy to listen to economists who say that short-term spending is the only way to put Americans back to work and end this recession-deficit. Choosing to focus on job creation shouldn't be a difficult policy decision, and for the sake of my aunt, her husband, her children and the future of the middle class, I hope the President agrees.
Heather McGhee is the Director of the Washington Office of Demos, a non-partisan policy center that has launched a new progressive project on fiscal policy, www.OurFiscalSecurity.org
Follow Heather McGhee on Twitter: www.twitter.com/Demos_Org
( ( Amount my revenue will increase if I hire you ) - ( Amount you cost to hire ) ) > 0
If you bring in more money than you cost, you get hired. If you don't then you don't get hired. Taxes on profit have nothing to do with this equation since manpower costs are tax deductible. So you will always pay for yourself and then what's left over gets profit taxed.
Now, if you want to "assist with the creation of jobs" you need to make either the amount of revenue an additional worker produces go up, or the marginal cost of the worker go down.
You don't do either by "redirecting some of their expenses toward small business". Any jobs you create that way are temporary and dry up as soon as the subsidy does. You do it with public works and public programs.
For example. Say you are adding public transportation to my city and there is a stop near me. This will increase the traffic by my restaurant which causes me both to need additional staff and have the money to pay them.
Or, say you implement UHC and fund it with profit/income taxes. Not Payroll taxes. This would shrink tremendously the marginal cost of hiring someone since you are paying for their healthcare whether you hire them or not.
Paying a low wage worker in the U.S. costs their pay, and their payroll taxes ( Social Security ) and their health insurance. Paying a low wage worker in the third world costs their pay, and extra shipping on the finished results, and greasing the right palms in the local corrupt regime. And has an indirect cost in that now fewer American's can afford your product so if everyone does it your sales figures will go down the drain or you'll have to slash prices tremendously ( race to the bottom ).
Implement Universal Health Care and suddenly the cost of health care isn't a marginal cost anymore. You are paying the same tax whether you hire or not. So now the marginal cost of hiring someone is their pay + social security. No more huge health insurance premiums. That is a Gigantic bite out of the cost to hire. And if the cost to hire goes way WAY down ... then more hiring happens. Because jobs that didn't make dollars and cents before suddenly do.
Get the tax code right and they pay in even if every single blue collar worker they have is in a sweat shop in the Philippines. Which makes said sweat shop less competitive with onshore workers.
No more outsourcing or in-sourcing until full employment in the USA.
No more jobs there, until full employment here.
en.wikipedia.org/wiki/It's_the_economy,_stupid
Ask a "conservative" (republican) if they stand for smaller government, less deficit spending and increased personal liberty and they will undoubtedly scream "Of Course"! Yet, of the last five administrations, only Clinton's actually reduced the size of government (by both numbers of employees and discretionary spending). Of the last twelve administrations, only three (Reagan, Bush 1 and Bush 2) increased deficit spending and the national debt as a % of GDP. And from warrant-less wiretaps to "gay marriage", suspension of habeus corpus to requiring immigration papers of anyone appearing Hispanic and wanting to amend the Constitution, or (god forbid) building a (shudder) Mosque - Liberty has become "freedom to be just like me", period!
Likewise, "liberals" (democrats) don't see the hypocrisy of appointing a tax dodger to be Secretary of the Treasury, a stimulus package to small and miss targeted to revive the economy, promises of transparency give way to secret meetings to gut major health care and financial reform bills, continuing the unnecessary Iraq war, rendition, Guantanamo, expanding Afghanistan, and on and on.
Simply depends on which load of crap you want to buy into.
1) That assumes Obama wishes to do so, when all evidence is that he's happy to be redistributing our wealth overseas.
2) That assumes that Democrats and liberals know how to create jobs. Judged by their actions in the past, they have no clue. Judged by Blumenthal's answer in Connecticut, they have no clue. Judged by the posts on HuffPost, they have no clue!
Every Senate Republican voted against the bill
So why is it that job growth has been stronger when Democrats have been president? Even for just the post-World War II era, few Republicans have had the record of job growth. From a rate of 7.5% in 1992, unemployment dropped to 4.0 in 2000. Allowing for 9/11, Bush startd at 6.0% in 2003, but he was only able to bring that down to 4.6%. Next time, do your homework.
I have never been hired by a poor man and either have you. You can't spend your way to prosperity or borrow your way out of debt. You will continue to fail if want higher incomes but punish big earners and desire wealth but penalize rich people. It's just that simple.
I pose this to you: Our money is not backed by gold or anything else but "faith in the system". So, even though we all know this, if you were offered a million of this unbacked money, would you take it? Of course, you would. Which simply proves that "faith in the system" works without backing by tangible assets.
Now, if the Treasury simply prints up money to distribute to the Federal Banking System to be lent to the commercial banks to be lent out for commercial use, and at each step the money creates debt through percentages, what is to keep the treasury from simply printing up the money and lending it to a series of foundations that help create jobs for the unemployed and function as a lender of last resort for the lower income people of America who want to create small business that will hire others?
The answer of course, is that the banking system that now holds America hostage would raise hell unto the heavens. So, the "faith in the system" as it now exists is more about keeping the present banking systems in charge of our printing machines than with solving our economic woes. So, your foolish rants about "punishing big earners, etc., is pure fantasy designed to keep the little people from rebelling and coming for you.
In 1929,the Gross National Product was $103.6 billion (not adjusted for inflation).
What was the GNP in 1933?
Assuming a multiplier of 3.5 (a standard assumption among economists), how much additional spending must FDR have committed to bring the economy back to the 1929 level?
What was the total federal spending in the peak year before World War II preparedness took over the budget?
" It was the austerity, sacrifice, and production of WWII."
Can you show that the spending increase had nothing to do with it? I should think that if George W. Bush had demanded austerity, the housing bubble that floated the economy in his second term wouldn't have happened and we'd be in worse shape.
So instead he is allowing the Federal Reserve to give the bankers tillions, and somehow this is what the evil ReThuglicians are known for?
Wake up. The political class is composed of the large multi-national corporations and both parties, so looking to either party is ignorant at the very least.
And you are kidding your self if you think that the government will ever force the banks to do anything, the banks own our government. The only way out of this was squandered the minute that they bailed them out and that was to have let them fail.
Now we are in this for the duration and it is not never over yet.
Until people start looking to themselves to solve our issues and away from government we are doomed. Heck 90% still believe this entire mess is because people that couldn't afford loans took them out. Didn't it take two to tango? The Federal Reserve loose monetary policy started this whole thing, and they are running the printing presses once again.
A job is when someone gives you money for work. Governments have money. They are made of people. Can you explain to me what's physically stopping governments from creating jobs?
So every penny the government spends is removed from doing productive work in the private sector. If government can just create jobs then why isn't everyone making say $100,000 a year working in a government job?
If you don't understand this concept, read a bit about what happened to the Soviet Union and you will understand.