Senator Harry Reid is at it again. While they continually deny the charge of inciting class warfare, Democrats in the U.S. Congress create new ways to tax “the man” and increase the social unrest between the haves and the want mores.
From FOX News:
“Senate Majority Leader Harry Reid, D-Nev., outlined plans for a 5 percent surcharge in a closed-door meeting with the rank and file, according to participants…” (Read more: http://fxn.ws/oh1E4k)
This 5% surcharge would be imposed on “millionaires.” This is how Reid and his band of Merry Men plan to take from the rich and give to the poor (and not so poor) and pay for the American Jobs Act. The Jobs Act proposes to:
- Create incentives for small businesses to hire and grow from now into 2012.
- Make investments that would prevent layoffs of as many as 280,000 teachers, provide opportunities for long-term unemployed veterans, and put Americans to work rebuilding roads, railways, bridges, and schools in need of repair.
- Implement the most sweeping reforms to the unemployment insurance system in 40 years to help those without jobs transition to the workplace.
- Expand the payroll tax cut, cutting workers payroll taxes in half next year. This provision will provide a tax cut of $1,500 to the typical family.
Now look at that list carefully and think about Reid’s proposal. In effect, he’s proposing to tax what he sees as the richest Americans; you know, those people who own the businesses that hire all the employees he wants to put back to work.
So — he’ll tax the rich to incentivize them to hire people without jobs. Now I’m no genius, but if he just left them alone wouldn’t it be likely that they’d spend some of their money creating new jobs? In fact, the most sensible solution is a reduction in the corporate income tax rate which would free up more resources for hiring.
Of course nothing is going to stimulate job creation unless and until the feds stop meddling. From Monty Guild and Tony Manaher at Guild Investment Managment (http://guildinvestment.com
“In conversation after conversation with CEOs, we are hearing a similar litany of frustration. They want to expand business, hire more employees, and procure more equipment. All such undertakings would obviously help the economy. However, but they are afraid to follow through because of three major uncertainties…”
The uncertainties they identify are:
- Uncertainty about the gridlock in Washington
- Uncertainty about government regulation
- Uncertainty about erratic stock markets
Smart business people hold fast in times of uncertainty. They’re not being greedy; they’re being prudent. They’re doing what we should all be doing: Banking our cash and hanging on until this volatility settles down.
The American Jobs Act does create jobs, but these are not self-sustaining long-term jobs. They’re saving many jobs that should be lost including those of civil servants and teachers that are being laid-off by communities that simply can’t afford them. Frankly, most of those jobs could be saved simply by rolling back the idiotic retirement deals too many communities made with their public employees.
Of course, saving public employee jobs is good politics!
If you take from the rich to give to the poor you are not growing the economy; you’re simply moving the chips around until the next hand is played. You’re expanding the entitlement mentality that is so pervasive today and you’re crippling an entire generation with public assistance. Fears that America is becoming the next Greece only sound ridiculous as long as we still have a majority of people working in the private sector; a balance that this and related legislation now threatens.
Ultimately, it’s not the government’s job to create jobs. It’s the government’s job to make sure we treat one another fairly in business by enforcing the law of the land. Of course, it’s foolish to cling to that expectation when one our corrupt government hires corrupt firms under their own indictments to investigate and audit other corrupt government agencies and beneficiaries to make sure there is no corruption, waste and misuse.
That I’ll save for another day.