What is your opinion on Tuesdays election results?

Partially true. But not completely. Small and medium businesses indeed create jobs in USA for americans. But big corporations? They offer more jobs overseas than they offer in USA. So why a tax cutt for them? Few months ago i gave Ford example. They asked for government help and they got the help they asked for. Next move? Opening a factory in Romania basically with USA tax payers money.

 

My opinion is re-elect no one. You should serve public office once. I was never intended to be a career.

 

Here's the thing that the lower taxes and deregulate crowd doesn't grasp. It's not the function of capitalist economics to create jobs. Capitalist economics is optimized to produce wealth. And one of the best ways to do that is lower labor costs. Essentially, capitalist economics has a built in incentive to actually eliminate jobs.

With system that's primarily driven by profit motive there's constant pressure to lower production costs so as to increase profit. Labor is one of the biggest costs. That's why you see so much downsizing, outsourcing, and automation. They lower labor costs and increase profit. And those trends aren't decreasing, they're accelerating. Combine a growing population with fewer jobs, creating a surplus of labor, and you get stagnate wages. The problem is, a capitalist economy is based on consumption.

It's basic supply and demand. The more goods and services consumed, the greater the economic activity and growth. The opposite is also true, which is one of the big reasons why economies around the world are having such slow growth. There's not much demand. There's a story that sums it up.

Supposedly, Henry Ford II was showing Walther Reuther, a union leader, around a new automated car plant. Ford said "Walther, how are you going to get those robots to pay your union dues?" Reuther replies "Henry, how are you going to get them to buy your cars?"

This is why deregulating everything and lowering taxes on big companies and the wealthy isn't going to solve our problem. The problem isn't that these people don't have enough wealth to create supply. The problem is the majority of consumers (which is the middle class) don't have enough wealth to create demand. The solution is to find ways to get the middle class more wealth that they can spend, thus increasing demand.

 

There are ways. Let's take the example I gave. Ford is asking USA government help. And he get the need help and then is opening a factory in Romania (not that I'm complaining... I'm romanian and was a good thing for romanian economy) while Detroit was dying. How about USA government to say "there you go Ford! Here's the help you need. In exchange you use a part of this help to open/extend an automotive factory in Detroit"?

 

I can understand that in a capitalist society a company should be totally free to chose where to invest, how much to invest, where to offer jobs, how many jobs to offer. But if its like this then said company should deal with a potential bankruptcy and not to ask government support. And if still ask for help that government should man up and put conditions that are beneficial for citizens and not just handout the money just because they are scared not to be called communists/socialist.

 

Or we might just cancel out the nafta act, the bill that was created during the Clinton time. That allowed the major outsourcing to foreign countries. As a result of that being in place, 4 or the 6 working adults in my family lost their jobs, because the companies moved to Mexico and Brazil.

That same company has downsized its state side building and workers to only management and HQ. The entire rest of it moved overseas.
If there would bring new policies limiting the abilities of companies to move overseas would create more jobs. I agree with tax breaks for corporation, on the grounds of I've never worked for a poor person. Poor people dont create jobs. But we should limit their ability to move there jobs overseas.

 

Or give tax breaks to corporations according to an annual revenue/new jobs created forumla. X amount of jobs in previous fiscal year? 100% tax break. No new jobs in previous fiscal year? 0% tax break

 

This isn't an attack either, but those colors are damn hard to read, on pc and tablet

Anyway, that's a specific problem where manipulating the tax code can actually help. You use a carrot and a stick. You give tax credits for jobs created here, and you give tax penalties for jobs created overseas.

Interestingly enough, there was a bill in 2012 that gave small-businesses tax breaks when they either added to their payrolls or increased pay, and accelerated the way in which they deduct business expenses. It got filibustered and died in the Senate.

It's a localized band aid solution though. It basically lowers labor costs here and raises them there. And it overlooks the fact that there's not much reason for businesses to hire new workers if there's no increase in demand for their goods in services. Still, you have to start somewhere and every little bit helps.

What would help more is restructuring the entire tax code and (here comes that term conservatives hate) redistributing wealth. There are a lot of things we can do that while still progressive would actually make it more fair. Switching from tax deductions to tax credits is one.

Tax deductions lower your taxable income and are equal to the percentage of your tax bracket. Tax credits provide a dollar-for dollar reduction of your tax liability. Deductions favor the wealthy. Credits make everyone equal. Here's an example. Mortgage deductions work on percentages. The more expensive the house, the bigger the deduction. A tax credit of $5000 (or whatever) would be the same for everyone.

Same goes for taxing capital gains at the same rate of regular income. I've never understood why money made from investing gets taxed lower than money made from working. Income is income.
Even Reagan understood that.

Those are just a couple of things we could do. But it requires recognizing the problem isn't a lack of wealth. It's the way the wealth is concentrated. Yeah I know, it's "theft" but what good is a system that creates wealth and increasingly concentrates it at the top while the majority gets poorer? I've heard the arguments that well, anyone can get wealthy, it just requires work, but I don't buy it. There's a reason why they're only 1%. The harsh reality is, most of us are not going to become part of the 1% no matter how hard we work.

That's why "We built that" was so amusing. Most of us don't own businesses. We work for someone else. And you'll notice they trotted out business owner after businesses owner talking about how they "built that" and not once did they bring out someone who worked for any of them that helped "build that" too. They were oblivious to fact that they didn't "build that" by themselves. And it shows in the way wages have stayed flat for so long.

Anyway, I'm all for capitalism. But everything in life requires a balance. Let's use some common sense and temper it with that evil thing called socialism.