Posted by
Philip Mella on Wednesday, August 05, 2009 3:14:40 PM
You may recall earlier this year how the Obama administration touted the need for the stimulus package to ensure strong job creation. That so little of that money made its way into the real economy should come as no surprise, but what's truly shocking is that liberals can keep a rhetorical straight face as they complain that jobs are still lacking. If you've had your latte or espresso you'll be fortified enough to wade your way through a lengthy editorial by a remarkably obtuse triumvirate published today in the Huffington Post.
It has the astonishing title "It's All About Jobs!", which is apparently a revelation for these gentlemen. They begin with the suspect premise that the administration should champion an "all-of-government national manufacturing and industrial policy designed to simultaneously ensure the competitiveness of US-based businesses and grow high-value jobs in America." A laudable, of somewhat seminar-sounding agenda, one that President Obama probably thought he was implementing when he forced the $785 billion 'stimulus' package down our throats back in February.
These gents champion putting "American workers first," but curiously absent from their piece is the word "unions." Economics, as any college freshman will tell you, is fairly simple: If the cost of producing a product is higher in one country than another you can't correct the difference with monetary policy alone--you have to reduce the costs in the host country. For example, the average car rolling off the GM line has $750 of steel but $1600 in health care costs. Moreover, the difference in average hourly rates for union workers versus those employed in America by Toyota is about 35 percent.
After demanding fair trade reforms, the authors ignorantly tout the reflexive "Buy American" program which is guaranteed to unleash a trade war that will only deepen our deficits with our trading partners. They erroneously characterize the problem as incentives that drive businesses to out-source, when, in truth, it's the disincentives to maintain business functions in the U.S. that are the primary problem.
Their only mention of tax relief is just another straw man that regressively shifts burdens from businesses to consumers. Indeed, we're momentarily encouraged when they state we should reduce "the corporate income tax and payroll tax," but they promptly add that we should move "to a value-added-tax or VAT to replace that lost revenue." It would be a sign that candor had replaced the left's unveiled infatuation with power if otherwise intelligent men such as these understood that reducing the tax on business has consistently resulted in increased tax revenues into the Treasury.
Indeed, two years after the much maligned Bush tax cuts, federal receipts were up 26 percent. Therefore, replacing lost "revenue" from a corporate tax cut with a VAT--a highly regressive tax--is completely unnecessary, unless power-retention, not economic growth, is your primary goal. And, the reason I put "revenue" in quotes is that the word doesn't apply to government receipts, but rather to corporations that receive income as a result of product sales or providing services.
Our employment outlook will only improve when--or, should I say 'if'--Obama and his liberal brethren significantly reduce the cost of doing business. The Democrats can draft long-winded editorials such as this, but for small businesses, which constitute the majority share of economic power in America, the solution is just that simple.