Tuesday, February 9, 2010

80 Billion dollar Jobs Bill Proposed

The Obama administration is going to unveil an 80 billion dollar jobs bill which will feature extended unemployment benefits and highway spending according to Reuters News.

Am I missing something? The only way the government can create a job is by collecting tax money to pay the worker that they hire. The government does not turn a profit. They skim the profits of those who are making money and use it to pay government workers. The way they get the money is by taxing workers and private businesses.

The private businesses create jobs so they can make money. They pay close attention to profits and losses. They can't make up losses by raising taxes. There is competition out there. So workers and management have to work together to have an efficient business.

A well paid worker can get by without any government help. He will have vacation time, health insurance and other benefits that he helps pay for by making money for the company. His natural loyalty will be to his employer who pays his salary, instead of the government that is giving him a handout. Is that a problem?

The government can create a climate in which job creation is encouraged. They can reward companies for creating American jobs that will be a tax base for the government. They can also adopt policies that would discourage private job creation. Like it or not, the government can influence unemployment and job creation. But they can not realistically create jobs that will last.

The only way the government can come up with more money when the tax base is eroding is to print it. anyone who has seen inflation in Germany after World War I, Yugoslavia in the 90s and currently in Zimbabwe does not even want to consider this course of action.

When I hear Obama talk about creating jobs, he seems afflicted with a dangerous naivete or a demagogic cynicism.

What will encourage job creation? What will encourage millions of Americans to invest again? These are the questions that should be asked by our policy makers. Until they start asking, I don't see any solutions coming from Washington.

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