My Initial Responses to President Obama’s Jobs Bill
My responses to portions of President Obama’s address to the Joint Session of Congress:
REGARDING: The purpose of the American Jobs Act is simple: to put more people back to work and more money in the pockets of those who are working.
RESPONSE: What’s not to like about that?
REGARDING: It will create more jobs for construction workers, more jobs for teachers, more jobs for veterans, and more jobs for the long-term unemployed.
RESPONSE: What are the details?
REGARDING: It will provide a tax break for companies who hire new workers, and it will cut payroll taxes in half for every working American and every small business.
RESPONSE: Companies will NOT add new workers because of this ‘concept’, thus it will be a waste of taxpayers’ funds and should be cause for great concern about the ‘thinking’ of those whose input was accepted by President Obama and the ‘thinking’, including the lack of his ability to comprehend the economics.
REGARDING: Pass this jobs bill, and starting tomorrow, small businesses will get a tax cut if they hire new workers or raise workers’ wages.
RESPONSE: Whew! Sorry, but I must catch my breath. Well, now that I can breathe, again, I find these concepts extremely infantile and inane, but I will attempt to explain my perceptions. If we have a business with ten employees who are at an 80% capacity, we could, theoretically, lay off two employees, but we are trying to keep our personnel, hoping that we will increase our sales. Will we hire a new employee if we don’t need one? Will we spend $40,000 a year to obtain a tax credit of $5,000-$10,000? I don’t think that would be a rational decision. We will hire an employee when we NEED an employee.
A plan that gives a tax credit for new hires is a waste of taxpayers’ resources, since a business will hire only if needing an employee. The exception would be when the tax credit exceeds the cost of the employee. Good luck on that happening. The designers of this ‘plan’ appear to be incompetents, at best.
REGARDING: Pass this jobs bill, and all small business owners will also see their payroll taxes cut in half next year. If you have 50 employees, making an average salary, that’s an $80,000 tax cut.
RESPONSE: Okay, we have found some details, and they happen to be very ominous. Using as estimated 100,000 such businesses and a savings of $30,000 each, that would be a total of $3,000,000,000, which would be a windfall for these businesses, but the effect upon the sales for those businesses would be negligible. These companies would employ about 1,250,000 or about 12-13 per company. The $3 billion would be vastly more stimulative to the economy by increasing the take-home pay of those 1,250,000 workers by $200 per month, thus this portion of the ‘plan’ should be a non-starter.
The goal of a plan to rev up the economy must be directed to enhance the energies, within the economy, which can be tapped by all businesses. Whoever designed this portion of the ‘plan’ should be reassigned to some unrelated non-economic function.
REGARDING: It’s not just Democrats who have supported this kind of proposal. Fifty House Republicans have proposed the same payroll tax cut that’s in this plan. You should pass it right away. RESPONSE: If the parameters of the payroll tax reduction are the same as for 2011, they are not appropriate for, at least, two reasons. The reduction in payroll taxes should be permanent and should be treated as an income tax credit, rather than a reduction of Social Security taxes, i.e., the tax credit would equal 6.2% of the first $40,000 of subject income. The concepts are permanence and sufficiency.
REGARDING: Pass this jobs bill, and we can put people to work rebuilding America. Everyone here knows that we have badly decaying roads and bridges all over this country. Our highways are clogged with traffic. Our skies are the most congested in the world. RESPONSE: This reflects the pathetic inactions of Congress, which have left our nation in such a state of disrepair. The concept of ‘rebuilding American’ must be an ongoing, everyday activity, not one that must wait to be included in some ‘stimulative’ plan. The People should and must be outraged at such fiscal nonsense. I will take a deep breath and continue.
REGARDING: This is inexcusable. Building a world-class transportation system is part of what made us an economic superpower. And now we’re going to sit back and watch China build newer airports and faster railroads? At a time when millions of unemployed construction workers could build them right here in America?
RESPONSE: Do I really need to respond to this?
REGARDING: There are private construction companies all across America just waiting to get to work. There’s a bridge that needs repair between Ohio and Kentucky that’s on one of the busiest trucking routes in North America. A public transit project in Houston that will help clear up one of the worst areas of traffic in the country. And there are schools throughout this country that desperately need renovating. How can we expect our kids to do their best in places that are literally falling apart? This is America. Every child deserves a great school — and we can give it to them, if we act now.
RESPONSE: Come on, now! Get serious! Congress can’t do these things and still continue the massive shift of wealth from the middle-class to the top 0.1%, during these past 30 years.
REGARDING: Pass this jobs bill, and thousands of teachers in every state will go back to work. These are the men and women charged with preparing our children for a world where the competition has never been tougher. But while they’re adding teachers in places like South Korea, we’re laying them off in droves. It’s unfair to our kids. It undermines their future and ours. And it has to stop. Pass this jobs bill, and put our teachers back in the classroom where they belong.
RESPONSE: Whereas the goal is solid, triage isn’t the way to achieve this. Just shifting federal funds to the various states will not resolve the problem. All public salaries and benefits must be reduced. The concept is that it is superior to reduce salaries and wages rather than reduce expenses through layoffs. This concept applies to all municipal, state, and federal employees.
REGARDING: Pass this jobs bill, and companies will get extra tax credits if they hire America’s veterans. We ask these men and women to leave their careers, leave their families, and risk their lives to fight for our country. The last thing they should have to do is fight for a job when they come home.
RESPONSE: Depending upon the details, this appears to be rational.
REGARDING: Pass this bill, and hundreds of thousands of disadvantaged young people will have the hope and dignity of a summer job next year. And their parents, low-income Americans who desperately want to work, will have more ladders out of poverty. RESPONSE: Whereas the goals are, absolutely, worthy, my guess is that the logistics may suck (a technical economic term). I recommend that all minimum wage laws be repealed. Further, I recommend a massive expansion of the earned income tax credit program (EITC), which would apply to U.S. citizens and those with green cards who are over the age of 17.
REGARDING: Pass this jobs bill, and companies will get a $4,000 tax credit if they hire anyone who has spent more than six months looking for a job. We have to do more to help the long-term unemployed in their search for work. This jobs plan builds on a program in Georgia that several Republican leaders have highlighted, where people who collect unemployment insurance participate in temporary work as a way to build their skills while they look for a permanent job.
RESPONSE: Just more attempts at triage. All energies should be expended upon the macroeconomics. The derivatives such as unemployment, deficits, debt, stock market prices, real estate prices, et cetera will be benefited.
REGARDING: The plan also extends unemployment insurance for another year. If the millions of unemployed Americans stopped getting this insurance, and stopped using that money for basic necessities, it would be a devastating blow to this economy.
REGARDING: And here’s the other thing I want the American people to know: the American Jobs Act will not add to the deficit. It will be paid for. And here’s how:
The agreement we passed in July will cut government spending by about $1 trillion over the next ten years. It also charges this Congress to come up with an additional $1.5 trillion in savings by Christmas. Tonight, I’m asking you to increase that amount so that it covers the full cost of the American Jobs Act.
RESPONSE: ‘And here’s how’? DOA? This is the ‘funding’ logistics? LOL, big time!! I am still laughing. Yes, tears and all.
REGARDING: And a week from Monday, I’ll be releasing a more ambitious deficit plan — a plan that will not only cover the cost of this jobs bill, but stabilize our debt in the long run. RESPONSE: Boy oh boy oh boy!!! I am at a loss for further comments, at this point in time. These last two are replete with ambiguities, and ambiguities are not good. Sadly, I am no longer laughing.
Since this ‘plan’, to this point of review, appears to be destined for about a 90% revision, I will end my critique.
Listening to his Address, I liked it. His delivery was excellent.
Was I too tired or weakened by the presentation? I don’t know.
Very frustrated, dismayed, and shocked (please forgive any confusion, since I don’t have the energy or will to review my responses),