ElectionAnalysis.com
Archive: 03/20/2004

First off, the president does not create jobs, and there is only a very small amount he can do to affect the job creation market. This is a myth perpetuated by the Clinton administration that was the lucky recipient of a growth surge than actually began under the first President Bush. Unfortunately for Mr. Bush senior, it came too late to save his presidency.

Secondly Kerry believes that if he just dangles a "tax carrot" out to companies, they will stop moving jobs offshore and create a slew of new jobs. But the incredibly unfair tax structure of the US is only one reason jobs are moving offshore, and a minor one at that.

The real reason is less politically correct. It's greed. Workers in many industries have bought the Democratic line that they are somehow "entitled" to better wages regardless of their job performance. Unions practically own the Democratic party, and with strikes and intimidation tactics squeeze companies for every cent they can, more paid holidays, cradle-to-grave benefits and ever lower standards for work quality. The minimum wage keeps going up and workers demand ever increasing levels of benefits until US corporations are nearly choked to death and unable to compete in the global market.

Result? To improve competitiveness and increase profitability, companies move their jobs to a market where people appreciate having a job, and understand that their pay should be equal to their skills and their contribution to the company. This benefits them in other ways as well. These foreign workers are much more dedicated to the overall health of the company, and the governments of these foreign nations do not treat the corporations as the enemy and publicly disparage them every day, as US politicians (mostly Democrats) do.

Then along comes John Kerry, who as a US senator voted for most of the business-choking laws and taxes strangling the companies to death. Kerry, now a candidate in the 2004 election, has the incredible arrogance to refer to the companies struggling to survive as traitors! This coming from a man who called his own brothers-in-arms war criminals.

Economically ignorant Democrats need to realize one fact. Other than the government, jobs come from one source and one source only. Businesses. When you create a climate that is friendly to business, they will thrive and grow and create new jobs. Over tax them, over regulate them, shove huge, bloated compensation packages down their throats and they will not only choke and lay people off, they will move to a more friendly environment.

As bizarre as these "entitlement" beliefs are, they are not surprising coming from a party that believe if you work and struggle and become successful, your reward should be to be punished by a cruel tax code. A party that believes after you work your entire life and finally die, 50% of everything you have worked for which has already been taxed should go to the government, instead of your family. A party that believes if a person wants to lay around and not work, they deserve to be taken care by all those who get up every morning and go to work, and do their best to support their families. They get to support the freeloaders as well.

America- wake up. The answer is not that difficult. Get out of the way of business, help it to thrive, stop treating success like it's a curse and successful people and companies like they are evil, and you will se a near miracle! The job market will swell to overflowing, and then you will be in a position to name your price, because all those millions of successful small businesses will desperately need your services and skills! It's called free enterprise. It's called capitalism. It's called America.
I find that the harder I work, the more luck I seem to have.
Thomas Jefferson

Our lightly managed capitalist economy has seen unprecedented and mostly sustained growth since the beginning of the end of the great depression. In 2003 we saw some of the fastest growth rates in 20 years. They just didn’t last very long. Since August of 2003 just fewer than 1 million hard-working Americans have brought home their first paychecks from new jobs. In March of 2004 businesses created approximately 308,000 new jobs. However unemployment is still around 5.7 percent and presidential hopeful John Kerry is making claims of creating more than 3 million new jobs within his first 500 days in office. This raises some serious questions. First, do we need to create 3 million jobs in less than a year and a half? Second, how does the federal government create 3 million jobs?

First, as President George W. Bush points out, America currently has the fastest growing economy of any industrialized nation in the world. Unemployment however is continuing to hover between 5.5 percent and 6 percent. A 5.7 percent unemployment rate today means that approximately 8.4 million people are looking for work. Three million new jobs in just under a year and half sounds like a good deal. Naturally if 3 million new jobs are created by businesses, and 3 million others are not lost in a short period of time, a lot of money is shifted to the hands of consumers, which, if consumers spend it, could increase the rate of economic growth to even higher levels. However growth that is too rapid can and does lead to "bubble" conditions, like those in 1929 or 1999.

Second, President Bush is practicing trickle-down economics, which are historically effective but have yet to raise the general level of employment. Kerry wants to practice "tax and incentivize" economics. He plans to repeal dividend and other high income tax breaks. The money would be spent on financing the ever-expanding deficit, doubling funding for the Manufacturing Extension Partnership (an organization that helps small manufacturing companies operate effectively), subsidizing health care costs, basic scientific research and development, and more — probably more than can be afforded. Disturbingly, Kerry wants to raise the minimum wage, which typically leads to higher unemployment or inflation, and index it to inflation. In other words, every time inflation goes up so does the minimum wage … Positive feedback loop anybody?

Perhaps the most interesting aspects of his plan are lowering the corporate rate for manufactures producing in America and a "new-jobs tax credit" which would refund two years of payroll taxes for new jobs above a company’s 12-month average. Remember that goods produced in America are more expensive and come at a higher opportunity cost than goods produced overseas, but employment is also extremely important. A corporate rate reduction for companies primarily manufacturing in America seems like a good idea to slow the flow of jobs overseas.

Both parties seem to be trying to spin the economic information to their favor. Imagine that. Bush continues to insist that his economic policy is sound despite the continuing unemployment and Kerry makes outrageous claims that vary from speech to speech, yet he always manages to attack the "evil" Bush. But ignoring the candidates for a moment, it seems logical that as the economy continues to grow, new jobs will created.

Under Kerry’s tax plans, American businesses would get tax incentives to keep their labor pools in the United States. Since the growing trend is for businesses to take advantage of cheaper labor and lessened governmental restrictions in other countries far away from here where Americans live, Kerry’s plan gives businesses a way to retain the bottom line in terms of profit — keeping shareholders happy — while staying in America and providing jobs for Americans who have no jobs — keeping America happy. By not moving its help center to India, "Company B" gets a tax break and "American C" keeps a job. Win-win.

That’s what’s so good about this plan. Not only is it good for the goose and the gander both, but it uses some common sense. What’s a good way to keep jobs in America? How do you fight outsourcing? Do you think "Company B" wants to go to India? Not really. "Middle-manager A" who works for "Company B" is from Detroit and would like to remain there. But his job moved to Delhi and, if he wants to keep it, he has to go with it, even though he’d rather stay in Detroit and not become an Indian citizen.

Outsourcing is fought using equal tactics. Give "Company B" some incentive to stay here. It would rather stay in America, but the profit margins in India are too appealing. All the government has to do is make its policies a little more like what makes India’s so attractive, or something equivalent. That equals tax breaks in lieu of marginal employee salaries (like the ones found in a lot of the popular outsourcing countries). You might say that this is pandering and that it’s worse than letting them go. But think of the jobs. Regular people need ‘em and businesses provide ‘em. It’s the perfect union. Shareholders are like the bride’s father and the government is like the groom’s mother — if they’re not getting along the whole marriage may get water thrown on it. And who loses then? The bride and groom, err, the businesses and the regular people.

This thinking doesn’t create new jobs today, but this does keep them here. Eventually, if everything works like it’s supposed to, "Company B" gets pretty big. In fact, "Company B" is so big that it’s expanded its help center by 50 people. That’s 50 new American jobs that weren’t there before and all because "Company B" decided to stay in the United States due to the tax breaks it got from John Kerry’s administration. Watch that happen with enough businesses and it becomes apparent where the new jobs are going to come from, where they’ve always come from — growth of the market.

Letting the guiding hand of the market have all the power is a dangerous and volatile idea. Granted, the market needs its freedom. But allowing the market to run about willy-nilly is like watching a starving snake start in on its tail. John Kerry’s plan to stave off the worrisome trend to outsource is a solution that has positive long-term benefits.

And don’t worry about the taxes lost by the breaks to get the businesses to stay — they’ll get made up for in the form of income taxes received by all those new jobs.