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Politics, Firearms, and things that amuse me

FINALLY! Politician Speaks Truth

with 5 comments

I’ve been dying to hear a politician, any politician, say what Linda McMahon said during a recent debate with Dick Blumenthal.

http://www.youtube.com/v/1jkU3RSfDGE?version=3

“Government does not create jobs.”

That is the absolute truth, and God bless McMahon for saying it.

Well, in one hundred percent honesty, the government can create jobs. A few, here and there, to be sure, but they are jobs. Bureaucrats, agency staff, military personnel, and to be honest, firefighters and police. But those are not the jobs that will grow the economy, increase standards of living, or lead to any long-term sustainability. Granted, the police, firefighters, and military jobs will protect the jobs that will, but the bureaucrats and government agencies will more often than not threaten them.

I get so sick to death of hearing, especially from Democrats, that Republicans are rewarding companies that “ship jobs overseas.” I honestly have yet to hear a coherent reason, in any form, of how they are doing that.

Here’s a fact: A company is in business to make a profit. That is their reason for existence. Someone, or a group of someones (sometimes known by the demonic title of “corporation”) has an idea for a product or service that someone wants. They decide that they will make widgets to sell on the open market. They also decide that since it costs, counting x-number of employees running the assembly line, raw materials that will eventually be molded into widgets, the cost of shipping those raw materials to the factory, and the trucks that will carry the widgets to your local WalMart will cost, broken down per unit, about $2.50 each. So if they can sell each widget at $4 each, and sell a million of them, they company, er, evil corporation, will make $150 Million at the end of the day.

Now, lets throw some other factors in there. Now Washington DC wants to add taxes to that $150 Million, because that’s windfall profits. And, by the way, you have to provide full-ride Health Control Insurance to every single one of those poor, downtrodden workers making those cheap-ass widgets you’re so proud of. Not to mention the Union Wages all those workers are demanding, now the cost of making each widget comes up to about $3.75. And it ain’t the Republicans doing that! Now, either you raise the cost of each widget to $6 each, or you find somewhere else to make them that won’t put those extra demands on the profit margins. Gee, you think China or Taiwan demands you pay thousands of dollars a year for Blue Cross Full Coverage for factory workers? What to do, what to do….?

I’ve said it before, and I’ll say it again: CUT CORPORATE TAX RATES, as low as you possibly can, and preferably to zero. You do that, drop that stupid Health Control Insurance mandate, and you will see companies flocking to our shores, providing long-term jobs, massive economic growth, and a higher standard of living for everyone.

The Government is not the answer.

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Written by James Lee

October 5, 2010 at 20:24

Posted in Uncategorized

5 Responses

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  1. “Government does not create jobs.”

    Keynesian theory doesn’t suggest that government replace the private sector in terms of jobs or the means of production.

    Classically, the policy is to maintain the government in balance. So if the economy is growing, leading to increased tax receipts, cut taxes. If the economy is shrinking, causing reduced tax receipts, raise taxes to cover the budget. The problem is that this exasperates the market cycle, leading to booms and busts. Cutting taxes while the economy grows causes it to grow faster, leading to a bubble. When the bubble bursts, raising taxes accelerates the decline, leading to a dangerous, downward spiral.

    Countercyclical (Keynesian) policy means to run a surplus during times of plenty (seven fat cows), and run a deficit during times of famine (seven skinny cows). In a modern economy that may mean progressive taxes, which dampen growth as incomes rise, but reverses when the economy declines. Unemployment insurance and other safety net programs act as automatic stimuli.

    James Lee: I honestly have yet to hear a coherent reason, in any form, of how they are doing that.

    Your own text explains why businesses ship jobs overseas. It’s economical, not ‘evil’. However, the government should not provide incentives to encourage such activity, and competing countries should be required to meet minimal safety, environmental and health standards to sell within the international markets. Unfortunately, countries vary in their social and industrial development.

    James Lee: Gee, you think China or Taiwan demands you pay thousands of dollars a year for Blue Cross Full Coverage for factory workers?

    Funny. Taiwan has universal health care, just like most of America’s industrialized competitors. Indeed, Taiwan has a mandatory single-payer system.

    Zachriel

    October 6, 2010 at 06:47

    • So in other words, then, to avoid the booms and busts, it would appear that the best solution would be to have taxes and regulations at as low level as possible (no, not NO regulations, just minimal), and remain as steady as possible to avoid some of the cause-effect on the cycles.

      James Lee

      October 6, 2010 at 07:40

  2. James Lee: So in other words, then, to avoid the booms and busts, it would appear that the best solution would be to have taxes and regulations at as low level as possible (no, not NO regulations, just minimal), and remain as steady as possible to avoid some of the cause-effect on the cycles.

    No. Boom-and-bust cycle is a cyclical problem in unregulated industrial markets. According to Keynesian theory, when the economy is expanding, the government should run surpluses to dampen excess demand; when the economy is contracting, it should run deficits to stimulate demand and soak up excess capacity. This tends to dampen the natural business cycle, and provides a cushion against unforeseen shocks.

    And let Pharoah take steps to appoint overseers over the land, and organize by taking a fifth part of the land’s produce in the seven years of plenty. Let all the food of those good years that are coming be gathered and let the grain be collected under Pharoah’s authority as food to be stored in cities. Let that food be a reserve for the land for the seven years of famine which will come upon the land of Egypt, so that the land may not perish in the famine.

    Zachriel

    October 6, 2010 at 13:21

    • The philosophical difference between us is the amount and to what degree should the government be involved in dampening the cycles. I, as well as most on the Conservative side, tend to think as little as possible.

      Sure, monetary and tax policies can and should be adjusted on occasion to help with stability. But getting too much involved, such as with TARP and other bailout programs, as well as targeting tax cuts like was recently done in Missouri specifically to help Ford Motor Company, leads to the government deciding who the winners and losers are. Not acceptable to most of us who believe in free markets.

      As far as surpluses and deficits go, as of right now we need as much surplus as we can get to pay off the massive debt this nation has been running up for decades. And I really don’t have a huge issue with a little deficit every now and then, as long as it’s not excessive, continuous, and intended for stupid things like tunnels for turtles or paying for advertisements to bring more onto food stamps.

      Raising taxes does not automatically mean more government revenue, and actually will lead to less if tax policy, such as it is now, leads to uncertainty and lack of investment into expanding the economy.

      And for the record, yes, I know BUSH was the one who signed off on TARP, as it was passed by a Democrat congress. I also believe the ‘economy-six-hours-from-total-collapse crisis’ was, at best, exaggerated for effect, and at worst, a complete fabrication (or brought by deliberate manipulation, which would actually be worse).

      James Lee

      October 6, 2010 at 13:45

  3. James Lee: I, as well as most on the Conservative side, tend to think as little as possible.

    Just enough and no more. (Of course, there are other functions of government than governing the economic cycles.)

    James Lee: But getting too much involved, such as with TARP and other bailout programs, as well as targeting tax cuts like was recently done in Missouri specifically to help Ford Motor Company, leads to the government deciding who the winners and losers are. Not acceptable to most of us who believe in free markets.

    The problem was that if the banking system went down, it would have brought down the entire global economic system. Sorry, the system broke down. There was no reasonable alternative.

    Winners and losers had little to do with who did the right thing. Many people were hurt who didn’t deserve it, people who worked all their lives. Many people made lots of money who didn’t deserve it, indeed, while driving their companies into the ground. It’s not just, but as a conservative you should know that not everything in life is fair, and not all problems are amendable to easy solutions.

    The existing system of handling bank failures through FDIC, which was instituted in the Great Depression, saved millions of people from losing their life savings (an automatic stimulatory mechanism). These banks were held accountable and shut down by the Feds. However, FDIC was not designed for the huge and complex entities at the center of the calamity.

    These huge banking concerns should have been decapitated and broken up, but it was conservatives who resisted and still resist this sort of accountability, even though under free market conditions, these concerns would have been bankrupted.

    Zachriel

    October 6, 2010 at 14:48


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