Interesting segment on yesterday's "All Things Considered" about Just What Do the Rich Have That's Taxable which examined how the very wealthy aren't paying 35%, let alone the 17% that Warren Buffet mentions.

What was striking was this part:

But Hanauer says the economy is like an ecosystem and that its lifeblood is the spending power of the middle class, not people like him. He says business people spend their time fundamentally on two things: creating sales and cost containment. Or, as he puts it, "how to not create jobs."

"The fewer jobs you can create, for the revenue you create, the more profit you make," Hanauer says. "The only time that businesses create jobs is when middle-class consumers essentially put a gun to our heads, in the form of orders for products that we can't make ourselves, and then we hire people and create jobs."

Assuming this is correct for a big portion of commerce, isn't it more important for the middle class to have incomes, than it is to subsidize "job creators?"

When the question is phrased like THAT, then it becomes a rhetorical question,

and of course the answer has to be "Yes".


(But the answer is "Yes" anyway.)

The old "creates" jobs meme is a tired and worn out mantra conceived to be a sop to ignorant and uninformed voters to put greedy politicians into office, usng the legal bribery of campaign "donations".

Both parties do it, but the Republicans are worse, have elevated it to a high art, and it is a touchstone of their political culture and guarantees their electoral success more often than not, even when they are simultaneously shutting down factories, and shipping jobs and production overseas to (as they loudly trumpet) "maximize shareholder profits".

Even THEN, masses of voters STILL can't connect the dots, when the poitical advertising machines get cranked up, and talk about "creating jobs" .


Joseph Goebbels was right: The Big Lie", if repeated often enough, can be made to sound like the truth.

And finally it BECOMES the truth.

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1991 560 SEC AMG, 199k <---- 300 hp 10:1 ECE euro HV ...

1995 E 420, 170k "The Red Plum" (sold)

2015 BMW 535i xdrive awd Stage 1 DINAN, 6k, <----364 hp

1967 Mercury Cougar, 49k

2013 Jaguar XF, 20k <----340 hp Supercharged, All Wheel Drive (sold)

Every attempt private industry has made to create jobs where no need exist has come to ruin. If the demand is not there then why would you hire extra people and produce products no one can buy?

Giving the 'job creators' more money is not the answer to create jobs. Giving the masses more spending power is, and how to do this...... Therein lies the rub.

I've been *****ing for years about the lack of the Buy American campaign of the '80's...bring back the demand for American made products, then the jobs will be made.

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1987 560SL
85,000 miles

I agree jp, and also with the previous posts regarding the failure of the "trickle down" effect when demand stays stagnant. The buy American discourse looks great on paper but unfortunately it's massively complex once you dig into it. It's one thing buying veggies from the local farmers market instead of the supermarket, but inthe world of cars and electronics and such, "American" means nothing. I recently bought a vw...but in effect I'm also buying semi-American since that money is being funneled into vwoa's new us plant. Likewise the chevy you just bought (congrats btw, looks nice!) features components and assembly from in and outside America, and the initial money spent on it is funneled into other countries as well. Its a tough situation to negotiate, big business like that very rarely operates within any jurisdiction anymore, regardless of trade.

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TC
Current stable:
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Past: 135i, GTI, 300E, 300SD, 300SD, Stealth

L.L. Bean 2011 Ad Campaign - The Holidays Are Made Here

Nice touch on Bean's part, but a casual flip thru their catalog will show that about 90 percent of their stuff is made overseas.

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In my humble opinon this is not going to happen unless trade tariffs become so steep that it pays manufactures to build things at home. Rather than even remaining static every day sees more items manufactured overseas. Especially in china.

There is also a real danger that if we were to resume or try to recover at least some of our lost manufacturing the consumers could no longer afford the prices. The real danger is if too much time elapses we may no longer be able to employ adaquate technology either to build certain things.

We are also pretty spoiled by what has occured over the years. Amount of hours worked to buy many things is now a very small percentage of what it once was.

This disposable additional income that has been created became a windfall for many necessities we consume. We can now afford excessive property taxes, utilities costs, etc,etc. What has made room for this in my opinion is the vast reduction in the cost of the average consumer goods being imported. Compared to what they really might have cost if made in north america adjusted for inflation over the years.

I am probably as guilty as the next guy. I want my cake and eat it too. These things cannot last indefinatly in reality though. The actual equation is too unbalanced. This already may be a fundemental underlying cause of the current unemployment situation. If it is not it will become this way at some point unless we start to retain and recover manufacturing we have already lost.

It has... ISM - ISM Report - November 2011 Manufacturing ISM Report On Business®

Sadly, most of the manufacturing that has either increased or is returning to the US isn't increasing manpower. Most of it has increased robotic usage or CNC usage...both can have low employment numbers with increased orders.

Unions artificially increased wages to the point that manufacturing could not sustain the costs, so it was off-shored to countries that have lower wages.

UC benefits are so high, that the average family brings in more money from the UC benefits than they could with a normal 40 hour a week job.

Until it pays more to actually work than it does to collect UC, the average UC collector won't be interested in working.

The best way to generate income in this country is to decrease the corporate taxes first off, then force the unions to allow wages to re-negotiated to a level that is manageable. Doing so will increase the available income tax revenue, increase sales tax revenue, and get people spending again, which increases the need for more employees...it's the circle.

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1987 560SL
85,000 miles

If workers are forced to re-negotiate wages, I think we can assume wages would be lowered. How will having less money in ones pay envelope increase income taxes? Combined the reduced wages with lower corporate taxes and the stock holders will reap the benefits.
Of Republicans want to eliminate capitol gains taxes.
The biggest problem is the cost of healthcare and healthcare insurance.
Businesses in other countries don't have such high costs.

How do you support artificially high wages? Either you subsidize the cost of the product that the company sells, or you move the jobs offshore.
Remember this truth from Lee Iaccoca--Next he took on the union and said: "Look boys, I've got a shotgun
to your head. I've got thousands of jobs at seventeen bucks an hour.
I've got no jobs open at twenty."

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1982 300SD " Wotan" ..On the road as of Jan 8, 2007 with Historic Tags

How can a wage be artificially high? Wages are negotiated.
The same people that whine about taxing success when higher taxes for the wealthy are proposed are the same people that claim negotiated wages are too high. Now that's hypocracy.
Ioccoca was then, this is now. He didn't have 2 wars and the prescription drug act to deal with.

For wages to be "high" it has to be relative to something else, yes? So, which countries are US wages "high" compared to? Within the US, there are states that are more attractive to manufacturing, traditionally the state were unions do not have a presence, but at least the jobs remain for US workers.

If you thought that one was interesting, did you hear/see this one:

GOP Objects To 'Millionaires Surtax'; Millionaires We Found? Not So Much : It's All Politics : NPR


How many millionaire job creators can the GOP find to be interviewed?

We wanted to talk to business owners who would be affected. So, NPR requested help from numerous Republican congressional offices, including House and Senate leadership. They were unable to produce a single millionaire job creator for us to interview.

So we went to the business groups that have been lobbying against the surtax. Again, three days after putting in a request, none of them was able to find someone for us to talk to. A group called the Tax Relief Coalition said the problem was finding someone willing to talk about their personal taxes on national radio.

So next we put a query on Facebook. And several business owners who said they would be affected by the "millionaires surtax" responded.

"It's not in the top 20 things that we think about when we're making a business hire," said Ian Yankwitt, who owns Tortoise Investment Management.

Tortoise is a boutique investment firm in White Plains, N.Y. Yankwitt has 10 employees and in recent years has done a lot of hiring.

As a result, Yankwitt says he's had many conversations about hiring, "both with respect to specific people, with respect to whether we should hire one junior person or two, whether we should hire a senior person."

He says his ultimate marginal tax rate "didn't even make it on the agenda."

Every commodity has a price in the marketplace where it will sell. If wages force the price to be too high to sell, then the product sits on the shelves, and no one gets paid. If you increase the cost of imported competitive products, you end up with the ultimate consumer subsidizing the "too high" wages.

I am not comfortable with the run-away greed among some of the wealthy, but neither am I comfortable with government intervention. For all of you who love to point to Europe for inspiration, have you noticed that even there, the socialist policies are failing? Not a good model to follow.
Neither should the government be subsidizing producers. Live or die in the free market.

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1982 300SD " Wotan" ..On the road as of Jan 8, 2007 with Historic Tags