For twenty years I've sued the federal government on behalf of small businesses. I have won more than 25 lawsuits and legal battles against various agencies. I have over a dozen active lawsuits and 15 more to file. When the Supreme Court refused to hear a case I had against the Small Business Administration (SBA), it was the only time I lost. I testified before Congress and provided information to federal agencies that resulted in a number of federal investigations. These all uncovered the fact that Fortune 500 firms are the real recipients of most federal small business contracts.
But I've come to understand that no matter what I achieve, my opponents in Washington continue to try to convince the media and anyone willing to listen that I am a conspiracy theorist. So here's another one of Lloyd Chapman's conspiracy theories.
I don't think President Obama is trying to create jobs. His jobs bill is designed to get him re-elected. I think if you looked at the facts you'd agree. President Obama rolled out his jobs plan Thursday night. At this point in time, nobody knows the details, but it appears to cost in the neighborhood of $450 billion. And it appears 60 percent is going to be in tax cuts. The rest is for infrastructure spending. I think he's basically proposing to spend $450 billion of our hard-earned taxes on his reelection campaign.
Here's why:
First, the research proving that tax cuts don't create jobs is extremely persuasive. A number of Nobel Prize winning economists have agreed that tax cuts don't create jobs, including George Akerlof of UC Berkeley, Franco Modigliani from MIT, Paul Krugman of Princeton, Kenneth Arrow of Stanford and Joseph Stiglitz of Columbia.
And the most conclusive evidence that he's not trying to create jobs is that he is ignoring the most cost-effective job creation program in the history of America, which is the Small Business Act of 1953. Today that legislation requires that a minimum 23 percent of all federal contracts be awarded to small businesses. The latest Census Bureau data indicates that small businesses are responsible for more than 90 percent of all net new jobs. About half of all Americans are employed by small businesses, about half of GDP comes from small businesses and more than 90 percent of all U.S. exports come from small businesses. So it certainly makes sense to direct federal contracts to small businesses. Yet since 2003, a series of federal investigations have found that billions of dollars a month in federal small business contracts actually go to Fortune 500 firms in the U.S. and to the biggest companies in Europe and even Asia.
In 2005, the SBA Inspector General (SBA IG) released Report 5-15, and referred to the diversion of federal small business contracts to large businesses as, "One of the most important challenges facing the Small Business Administration and the entire federal government today." The part that really gets my attention is, "the entire federal government today." That's a powerful statement, and inspectors general aren't prone to publishing conspiracy theories. That should carry some weight with the media, Congress and the public. It seemed to carry weight with President Obama during his 2008 campaign when he released a statement in support of small businesses that ended with this sentence: "It is time to end the diversion of federal small business contracts to corporate giants." But when you search for anything he's done to end this abuse since being elected, you come up empty. He's done nothing to stop the flow of small business funds to the largest businesses worldwide. These are businesses like Boeing, Lockheed Martin, Rolls-Royce, General Electric and Finmeccanica--an Italian defense conglomerate with 75,000 employees and $33 billion in assets.
If President Obama were sincerely trying to create jobs, he would simply issue an executive order halting the diversion of federal small business contracts to large businesses. It would redirect upwards of $200 billion every year to the middle class. But the President is not doing that. He is flushing an additional $450 billion down the toilet. So I say that Obama's real goal with his jobs bill is simply to get reelected. Because if he really wants to create jobs, he needs to stop giving federal small business contracts to the largest companies in the world. This would create more jobs than any policy he has ever proposed.
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In there nothing good in offering payroll tax breaks for hiring workers?
Is spending on infrastructure improvements a waste of funds?
The problem with the SBA is real and pervasive. It has been a problem for years.
It is not new to this administration and was not caused by this administration.
Multinational corporations break themselves into smaller units to become eligible for the SBA programs.
President Obama couldn't do everything in one speech. He faces obstruction at every turn. Let's give him credit for trying to do some good in the face of bad news.
Washington is in business is to maintain its status quo; the purchase and sale of government by the highest bidder. Proceeds from this agreement are the resources used by political players to sustain their positions in government.
Also, there has been all this hoopla about the plan creating "or saving" (their new cover their rear phrase) ONE MILLION JOBS! That's all well and good but we need twenty-five million jobs. We need a plan that will put three hundred and fifty thousand people a month back to work, every month, for a year just to get down to a MANAGEABLE unemployment rate! So Obama's big plan is at most five months of what needs to be a multi year plan?
The man is either delusional or a liar.
I am tired of thinking "he will finally get it." Because he won't.
We have no choice but to vote for him but by God please find Progressives to put in the House and Senate to at least get one or two good bills to this incompetent (or criminal) boobs desk.
It has been obvious that Obama was going to start looking more like a Democratic president now because it is campaign time, and that's what he does well.
However, your assertion that tax breaks dont help employment is only half right, and I believe those economists you named will agree. Tax breaks for the rich don't provide jobs, because the rich already have plenty of money so the tax break just goes in to the hedge fund account. Tax breaks for regular people can help, usually only at tax time, by letting people keep some tax money that they need for groceries, to get the car fixed, etc. They spend it, and that money provides jobs. Magically. No "Job Creators" involved. It's giving those "Job Creators" more money that is wasted.
Any superficial appearance of weakness in his actions are in fact quite the opposite of the truth. Obama is masterfully capable of superseding any intention to force conformity to ideology that fragments the greater good of all. I hope his arguments behind those closed doors are convincing enough for others to follow his lead.
How does it help to criticize Obama using the argument that tax cuts don't create jobs? If you no longer have Obama, then all you are ever going to hear about jobs creation is tax cuts, because that's what republicans believe. And no evidence to the contrary has ever done anything to convince them otherwise.
Spending money on extending unemployment benefits and rehiring laid off teachers, fireman, policemen, and other first responders is more vote getting. What happens to all these people when the federal dollars end? The states, cities, and counties lay them off because they don't have the money to keep them on the payroll. As for the long term unemployed extending their benefits another year gets their vote (if they vote) but has no multiplier effect on increasing GDP.
I don't want this bill to pass.
Do you wonder why Treasury Sec Geitner embraces the president's plan? Do you really think he believes in Social Security? He sees how this is going to dismantle Social Security. A privatized system will infuse Wall Street with hundreds of billions of dollars.