Corporate welfare

[quaker bill]

Listening to some of our candidates at thursdays debate, I heard economic policies that included tax incentives and government subsidies to retain businesses and "create jobs".

Mr. Lieberman talked of government subsidies for research with the intent of creating new high tech industries. Looking that the jobs lost during the * administration, this seems unlikely to resolve the problem. While I would be all for investment in high tech focused on energy independence, creating high tech, high wage jobs will not resolve the immediate employment problem.

From Mr. Edwards I heard about tax incentives to retain industries and / or have them locate in economically depressed areas. It seems to me that we cannot create sufficient incentive through tax preferences to prevent out-sourcing labor to third world countries. While this is a worthy goal, a regulatory approach may be the only option. The difference in labor costs are just too great.

Further, if the company intends to manufacture within the US, tax incentives seem to result in a race to the bottom bidding war between locales. Why should we spend tax dollars to relocate businesses already wanting to or doing business in the US?

Finally, perhaps a screening of Roger & Me would do these guys some good. Once government gets into an incentive bidding war to retain businesses then all an owner needs to do is threaten to leave to extract more goodies. As Roger & Me so clearly illustrates, once they have gotten the goods, all bets are off.

I liked Graham's answer best. When asked which policy he would favor to create more jobs, he stated that he would not choose any of the above policy options, he would just go out and create the jobs. It is just that simple, hire people.

In Fla, what he and Lawton Chiles did to deal with the Bush 41 recession was to take the existing surplus in the road improvement trust fund, bump all of the projects on the existing 5 year plan up so that they would be completed in 2 years or less. There was a resulting boom in the construction trade to the extent that minimum wage jobs in many sectors and locations all but disappeared. Even fast food franchises were paying a premium to get labor. The economy recovered. My experience suggests this is the right idea.

[gully]

1. Interesting, Thanks Quaker Bill!

:thumbsup:

[WhoCountsTheVotes]

2. Graham sounds like FDR here

great post. I'm tired of the corporate welare too - if we're going to pay money to create job, do it directly, why should outsiders get to skim off the top? Good for Graham.

[quaker bill]

3. Thanks

for the comments