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Is it economic suicide to ask the top 2% to pay a bit more in taxes? After all, don't we all need to bathe in the warm shower of what they choose to trickle down upon us? Or, could it be they don't give a crap about jobs at all? More below the fold:

One reason that the Republicans, and their big-money backers, still find support for cutting taxes on millionaires and billionaires is that the super-wealthy have been branded as "job-creators." The problem is that the description doesn't match the reality. Sure, sometimes the big corporations and super-wealthy create jobs. For example, a new Home Depot may be built in a suburban shopping plaza. People can get jobs there (albeit with low-wages and little or no benefits). Dig a little below the surface, however, and the picture is less straightforward. Home Depot is a huge chain with powerful purchasing power. They have used this power to force suppliers into cutting production costs on tools, lamps, lawnmowers and thousands of other items. Many of these suppliers have responded to this pressure by outsourcing jobs to low-wage countries. I can remember a revealing conversation I had with a Home Depot clerk who explained he used to work for the company that made the saw I was examining. "It was nice getting good pay to make a good product. Now I'm making peanuts selling stuff made overseas." So many working people have lost decent jobs that they'll even take crap jobs, often with their hours deliberately limited to fall just shy of receiving benefits. Of course we shouldn't forget that Home Depot won't be re-investing its profits in the local community, unlike the four small, family-owned businesses it will push into bankruptcy.

But what of the individual plutocrat, doesn't his spending stimulate the local economy? Consider the heir of an industrialist fortune, who conspires with Wall Street looters to move production overseas and sell off the family firm's assets for a quick profit. He may move to a tropical island, but even if he decides to maintain a country estate near the old factory town, so what? Are the thousands of people devastated by the collapse of local industry supposed to cheer because Phineas Bigbucks employs a half-dozen domestics to staff his mansion?

In short, creating jobs is something the super wealthy will do if, and only if, it suits their own interests. High unemployment rates mean lower wages, so these "job-creators,' actually have very little interest in creating many jobs. Of course genuine small-business owners (not billionaires) do have an interest in restoring American prosperity. A car-dealer, or furniture store owner, needs gainfully employed customers. Paying a slightly higher rate on the income earned over a quarter-million dollars would not hurt these people in the least. In fact, if anything, this modest raise on profits kept as income could spur people to re-invest more money into new hiring and business development. Note--this is cross-posted on my own blog,Left side of the gorge

Originally posted to Ulysses795 on Sun Nov 21, 2010 at 07:49 AM PST.

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Comment Preferences

  •  Jobs only exist as delegates of work and (0+ / 0-)


  •  The only jobs the top 2% create... (6+ / 0-)

    ...are Republican candidates, these days. That's the real reason the Republicans are stumping for extending the whole tax cut shebang. The flip side is that if the plus-$250K tax cuts are not extended, or the whole tax-cut package sunsets, the wealthy owners of the Republicans will be out all the millions of dollars they had wasted getting those clods elected. The wealthy owners, in turn, will seek to take it out of the collective hides of the Republicans for that failure. It should be amusing, in a painful way, so get your popcorn ready!

    Float like a manhole cover, sting like a sash weight! Clean Coal Is A Clinker!

    by JeffW on Sun Nov 21, 2010 at 08:04:57 AM PST

    •  Not true, the wealthy create jobs for (5+ / 0-)

      media 'pundits' propagandists.

      However, the American wealthiest 2% no longer need the American workers for production purposes.
      Between offshoring and modern technology those jobs are gone and never coming back.

      For the last 25 or so years, the masses in the American workforce have primarily been useful to the wealthy as consumers and the propaganda was used to steer the herd in that direction.
      Now those workers are no longer needed by the wealthy and the American people have been sedated we have cuts in retirements, pensions, education, safety nets, law enforcement, etc.
      It will be interesting to see what the next step in this evolution is.
      Removing any assistance to and abandoning the economically weakest members of society, the elderly, the children, the sick and the poor is now in the works.

      AKA;Thinning the herd?

      All so the greedheads can have those second and third homes in Jackson Hole or at the beach and so they can have their 4 car garages, boats and private planes.

      What would Jesus do?
      I don't think wintering in Palm Beach, skiing in Aspen or buying a yacht would be his top priority, but for those who live that life; they are so isolated from the common shlub that what's happening probably doesn't even show up on their radar.
      For them life is great, exactly the way it is.

    •  they've got more than a few Democrats as well (3+ / 0-)
      Recommended by:
      phonegery, JeffW, strangedemocracy
  •  There was another diary (6+ / 0-)

    a few days ago that went into great detail concerning why tax cuts on the wealthy do not create jobs.

    Most small business people do not earn $250k. Many are professionals such as doctors, lawyers, or accountants who either have no employees or already have the staff they need.

    Hiring new workers is predicated on demand for a product or service, not how much spare cash happens to be lying around. And the truly wealthy tend to invest extra cash in bonds or stocks, which do not put money in the pockets of small businesses. Money for business expansion tends to come from retained profits.

    Besides, GWB cut taxes like a fiend, and had the worst job creation ever measured, even if you don't count the losses of the economic crash that occurred as a result of his policies.

    "A lie is not the other side of a story; it's just a lie."

    by happy camper on Sun Nov 21, 2010 at 08:05:43 AM PST

    •  Good point about denand, investment (4+ / 0-)

      You make an excellent point regarding how piles of extra after-tax cash don't translate into new jobs. Yet extending unemployment benefits allows folks to continue buying food, shoes, etc. and thus preserve jobs. This is why recent actions of the Rethugs in D.C. suggest they really want to keep jobless rates high, at least until 2012

    •  That diary can be seen at (3+ / 0-)
      Recommended by:
      happy camper, DBunn, strangedemocracy


      By the way, one thing that tax cuts for the wealthy does do is free up more cash for investment in stocks and bonds.  The rich do not spend money for a new refrigerator when they get these windfalls, they invest them.  As a result, there is more money chasing the same number of securities and stock prices go up.  Wall Street loves this and the investor class feels better, and the cycle continues.  Finally, the price of these pieces of paper far exceeds the intrinsic value of the things they are supposed to represent and the bubble pops.  Sound familiar?

      But the important thing here is that Wall Street loves these tax cuts, because it means lots of money for them.  Connect the dots and you know who the Republican party and many Dems actually work for.

      •  Thanks for the link (1+ / 0-)
        Recommended by:
        happy camper

        The diary you mention offers a nice distillation of important points, made by Paul Krugman and other rational observers of the capitalist system. Your characterization of Wall Street bubbles is right on. It's interesting that stock markets have generated speculative booms and crashes for hundreds of years.

  •  NYC Mayor Mike Bloomberg is a billionaire (5+ / 0-)

    several times over, yet he wants to axe the jobs of thousands of NYC municipal workers. Which way is the money trickling in this paradigm?

  •  The trouble is.... (1+ / 0-)
    Recommended by:
    william shipley

    most of the jobs created are in China. That doesn't do us much good here in America.

    Where are all the jobs, Boenher?

    by Dirtandiron on Sun Nov 21, 2010 at 09:26:33 AM PST

  •  It's all just Hype (3+ / 0-)
    Recommended by:
    phonegery, Dirtandiron, deweydog

    Outsourcing creates jobs in other countries.

    It increases unemployment in the US.

    Unemployment creates less demand, because the middle class is in survival mode.  No frills.  Just the basics.

    More businesses go under.  Creating less employment, and creating less demand.  It turns into a circle of downward spiral.  You get the picture.

    We need to create demand for goods and services.  But the corporations are depending on paying no taxes, and getting bailouts for doing nothing.  

    If I didn't know better, I would think they are trying to completely destroy this country.   :)

    •  Great comment, but what do you know (1+ / 0-)
      Recommended by:

      that I don't know, because I think they are destroying the country by doing whatever it takes to maximise their personal wealth in the short run.  They are being helped along by the GOP.  A friend of mine once said that these folks are very dangerous because they "make their own wind".  What he meant by that was the very wealthy have no allegiance to the US or any other place.  After, they crater the US, there will be no consequences to them.  They will simply go to their home in Costa Rica, or Dubai, or Cannes and live fat.  Most of these people have many residences, and private jets, they really don't have to care about anything except preserving their fortunes and much of that is already offshore.

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