Tag Archives: Accounting

Another waste of taxpayer funds by people who don’t understand business

Government employees who have little, if any, business experience are bound to come up with wasteful ideas.  Here’s another one:

Via Obama Announces $33 Billion Hiring Tax Credit for Jobs – ABC News.

Under the president’s proposed tax credit, businesses would receive a $5,000 tax credit for every net new employee that they employ in 2010. The total amount of credit will be capped at $500,000 per firm to ensure that the majority of the benefit goes to small businesses.

This is simple: While a few companies might hire employees they otherwise wouldn’t have due to these incentives, the vast majority of businesses fall into one of two categories:

  1. Business that don’t have demand for their goods and services and don’t need to hire.  Even with a $5,000 incentive, hiring new employees means they’ll be paying more for wages than necessary.   They won’t use this program.
  2. Businesses that were going to hire anyway.  They had demand for goods and services but didn’t need the additional incentives.  Sure, they’ll cash the checks, but what’s the point?

Leave the $$ with the taxpayers and let them spend it how they like.  That will stimulate demand and lead to real hiring.  Don’t give it to an inefficient government that will take its cut then waste the rest by giving it to companies that were going to hire people anyway.

A big part of the problem

Listen to the President talk about why he would raise capital gains tax rates even though cuts by Clinton and Bush both increased revenues.

Amazingly enough, the liberal commentator Charles Gibson knows and tells the truth about what happens when the capital gains tax rate is reduced:

History shows that when you drop the capital gains tax the revenues go up.

But note how Obama ignores the facts and says he wants “fairness,” as if having a higher rate for those evil rich people will make things more “fair,” even though there will be less tax revenues to fund his liberal projects.

As I said in Jobs!!! Part one, here’s a huge part of the problem: Are You Smarter Than a Fifth Grader?  Self-identified liberals and Democrats do badly on questions of basic economics.  The video is just more evidence of that, not to mention the failure of putting Utopian ideals above financial facts.

And you wonder why unemployment is so high?  It is just like when ideology and feel good finger-pointing unnecessarily cost tens of thousands of jobs with the offshore drilling moratorium.

Hat tip to TNWAHM via Hillbuzz for the video