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Obama’s new Jobs Act. Will it work?

Someone asked today if I thought Obama’s Jobs Act would work.  That got me to thinking…

 As I listened to his speech the other day I was impressed by how many things he said that sounded truly amazing.  I thought to myself; “Has he finally found that bold new direction that will turn this around?”  Then the details started trickling in and shed some light on this newest political strategy of his.

It’s kind of like watching a street magician pocket someone’s wallet.  The mystical-seaming flourishes of the one hand mesmerize us for a short time while his other hand slips into your back pocket.  Ever notice that political speeches tend to be framed by human props?   I’m not just talking about Obama here, there’s plenty of practitioners of the human-prop game on both side of the “Isle.”  So on this occasion, Obama surrounds himself with Teachers, Firefighters, Policemen, Veterans, construction workers and small business owners.  OK, I’ll wait to see where this is leading…

Realistically, it’s leading nowhere.  Think about it:  The House will block it and the Senate will pass it.  The end result is still no movement.  Again.  Who you blame for that depends upon your point of view, but it remains that both houses of congress are currently diametrically opposed with no end in sight until the next election cycle.

Ok, so first off he begins by rolling out the plight of teachers and how his plan will hire more teachers.  Oh!  The Kids!  Yes, everyone agrees that we can’t be unfair to children and they need teachers…  At least he has enough decency not to march in a few orphans just to drive home his point, but can you see the grandstanding begin to kick into high gear yet? 

Watch that hand…  Well, teachers are paid by tax dollars, so that means more taxes or more spending, right? 

Ooh, that was a close one, almost lost sight of the other hand for a moment…

And now come the veterans…  Really?  Sweet!   No matter the source, I’m all for helping out those who have sacrificed for my freedoms.  I was wondering when he would get to them, now there’s something I can agree with him on.

But wait!  Isn’t this the same President who has been trying to slash the military budget ever since he took office? 

See?  There’s that other hand again…

OK, now that I can see a pattern developing, the whole slight-of-hand thing is just beginning to annoy me.  Who’s next?  OK here come the firemen, the police ; all of them very fine people and well deserving (more tax funded increases coming) and now…  construction workers? 

OK, that one threw me off for a minute until I remembered the unions.  Yes, he must pay them back for all those mandatory union dues funneled into his election campaign; so yes construction workers makes sense too.  Airports clogged?  Could it be the TSA is far too engrossed in grabbing every crotch within reach?   Ah, rebuild the airports.  There’s definitely a construction boom (again tax funded) in the making here.  Did Hoffa Jr. write this speech perhaps?  And look how nicely he’s tied in the poor teachers with the Unions by starting a school rebuilding project…

OK, now on to the small business owners, right?  What do they get?  Somehow I just can’t get this tune out of my head just now… “This is starting-to-feel a-lot like (tax finded) Christmas…”

Yes, small businesses are struggling, so…  Cut taxes?  Sweet!  Wait, where’s the other hand? (I’m learning, you see) See, he said cut taxes in half?  Where’s the other hand?  I keep waiting for a punch-line but I’m not seeing it.  No loopholes, no “Only if you do X, Y and Z” kind of manipulations…  And write-offs too?  It’s almost Conservative in it’s simplicity and directness.  I’m at a loss here. I don’t see a down-side; yet I can’t bring myself to trust a President whose been so adamantly against broad-based tax cuts.  I will look forward to finding out the details on this one in the next week or so.

Ok, a little about kids and summer jobs, prevent taxes from going up?  Oh, he’s referring to revisiting the Bush tax cuts again.  Fully paid for?  (This is going to be interesting)   Yup, he mentions the rich and corporations again as a source to pay for all of the new Union construction projects mentioned above.  This is old news, he’s referring back to his battle over the Bush tax cuts.  OK nothing new here. Moving on…

Watch the other hand…

I see there’s no mention of just how this is all getting paid for, a lot of vague statements don’t get the bills paid.  I suppose we wait and see if he tries to create another panel to cut costs in order to pay for this one too.  (so far the panel already in existence is at a complete standstill)

 

Ok, he follows this up with some of his usual fare, big oil vs. teachers; billionaires vs. education.  Ok we get the whole class warfare thing…

He wants more things made in America, but he’s targeting the very Coporations that are big enough to do just that.  Doesn’t he get that when you dig into the corporate pocketbook as extensively as he seems to be planning, that jobs instantly migrate overseas?

Color me impressed.  He kept Vice President down to only two words.  No room for the foot there…

Yes-yes, we are all tired of politics as usual and we all agree that it’s taking way too long getting out of this bad economy…  Take action!  Call your Congressmen! A rousing commencement that touches on all our frustrations at once.

 

Watch the other hand…

 

Just my view from the cheap seats…

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4 thoughts on “Obama’s new Jobs Act. Will it work?

  1. “There are a lot of things that we can do collectively, such as cutting down on credit debt, saving our money prudently and generally avoiding spending like drunken bureaucrats, and while that will go a long way if we can somehow find a way to spur that kind of activity in a large number of people, I think”

    Here's an odd thought: Could it be that it was just this kind of widespread imprudent and drunken spending that was carrying along the growth and activity in the economy? And were we all living in “the Land of Oz,” until someone shot the man behind the curtain?

    “ …the true answers to spurring a resurgence in the economy has to happen someplace with more pulling power, namely businesses.”

    I agree with this, in principle, but I think it's actually more complicated. I don't think a business can, by itself, just simply decide one day to hire more workers. Most small to medium sized businesses run pretty close to the line, and don't have a lot of excess capacity to just "go out and hire somebody" without a lot of justification, such as a big increase in customers that their stores can't adequately handle, or unexpected orders that their manufacturing or supply lines can't fill. That's why I thought it was so silly to think that the Feds could simply give business some incentive payments to "hire workers". If I ran a small mfg operation, and some unexpected funds came in, all else being the same, I certainly wouldn't hire someone. What would I give them to do? I wouldn't buy new machinery, because things are smooth just the way they are, and I wouldn't know if I could justify the new machines later. So I wouldn't waste the money. I'd probably put it in the bank for a cushion so I could handle "real growth" when it came along. Then, when more customers started coming in the doors, I'd prudently use it where needed, to accomodate the increased demand. Some companies I worked for would use an unexpected uptick in profits to replace outdated and failing equipment, or buy larger or faster machines, because their marketing managers (with their fingers on the industry pulse) could make reasonable projections of increased orders to justify it. (They used to call this "investment") What they WOULDN"T do, is go out and hire a dozen workers, in the hope that orders might increase, UNLESS marketing could make reliable projections of increased sales.

    I feel silly saying this, because almost everyone in business and manufacturing knows this, because their world has always worked this way. The businesses that didn't learn this don't exist anymore.

    “…Businesses have to be cut loose to grow and prosper.”

    Cutting loose is only part of the problem. There has to be a reason to grow. If you open the gate, the cows may wander out for awhile, but they'll come right back if there's no grass out there.

    ”Not to let go of the reigns entirely, but to give businesses the incentives they need to grow jobs and increase spending on goods and services. I am a big believer in trickle-down economics, it worked very well for Reagan…”

    Reagan had something going for him that we don't have now. He was winning the Cold War, and we were all scared to death of A-Bombs.

    ”…and you would think that we should have collectively learned that lesson by now.

    Public confidence in the economy can never be achieved with new government road construction programs or Union contract-handouts such as are present in Obama’s current Jobs plan, it has to be generated by companies in the private sector as they see regulations and tax rates drop off. Tort reform has been a clarion call now for quite a few years, but I have yet to see anything substantial happen on that front in Washington. Those in control of the agenda at this point just don’t have the political will to tackle that because they are too beholden to those legal firm interests who have been wining & dining them for decades. And this is not just a problem with Democrats; Republican politicians have had plenty of opportunities in the past to engage in real tort reform and have failed to take it on then as well.”

    If the Feds removed all of their bureaucratic impediments tomorrow, the economy would still just sit there. Manufacturing needs demand, but something has to start it. There needs to be a spark, which will probably involve a lot of personal risk. After all, we have stopped the whole machine. That's the true magnitude of what the Democratic "Spread the Wealth" philosophy has done to us. It will take some doing to get it all going again.

    Anyway, for what it's worth.

  2. Bob:

    Ever since I spouted off and got myself on your website, I have been a little more tuned in to the subject, and now I notice that a lot of different people around the country have been saying the same thing. Further reading shows me that a number of politicians are also saying the same thing, and that's good. But once again I think many of them are just slightly missing the point. Notice I said "slightly", because this is still all good.

    The politicians and government entities are still talking as if the confidence is something they will provide for us, as if they were going to send us a big "US Govt." box, and there's some bright shining confidence inside. That's where they're a little off. Confidence comes from us. We talk among ourselves, we come up with ideas, we follow through, maybe start some kind of little movement, and folks become interested, excited, and confidence grows from that.

    As I said in the previous post, we just need to get the roadblocks out of the way, and part of that, unfortunately, does have to be done by government: limiting the power of unions and tort reform.

    These are sensitive subjects, and many people avoid them but they don't realize how tightly connected to our freedoms they are. As I said earlier, they're the mud at our feet and the noose around our neck. So maybe we should start a dialogue about how folks like you and me can actually make some meaningful movement in that direction, without alerting the wolves.

    Any ideas?

    1. There are a lot of things that we can do collectively, such as cutting down on credit debt, saving our money prudently and generally avoiding spending like drunken bureaucrats, and while that will go a long way if we can somehow find a way to spur that kind of activity in a large number of people, I think the true answers to spurring a resurgence in the economy has to happen someplace with more pulling power, namely businesses.

      Businesses have to be cut loose to grow and prosper. Not to let go of the reigns entirely, but to give businesses the incentives they need to grow jobs and increase spending on goods and services. I am a big believer in trickle-down economics, it worked very well for Reagan and you would think that we should have collectively learned that lesson by now.

      Public confidence in the economy can never be achieved with new government road construction programs or Union contract-handouts such as are present in Obama’s current Jobs plan, it has to be generated by companies in the private sector as they see regulations and tax rates drop off. Tort reform has been a clarion call now for quite a few years, but I have yet to see anything substantial happen on that front in Washington.

      Those in control of the agenda at this point just don’t have the political will to tackle that because they are too beholden to those legal firm interests who have been wining & dining them for decades. And this is not just a problem with Democrats; Republican politicians have had plenty of opportunities in the past to engage in real tort reform and have failed to take it on then as well.

      As with anything, the government has so entrenched itself directly in the path of success for many companies through onerous healthcare legislation and other “Social Engineering” projects, that it will take a change in leadership within our government before we can possibly turn this boat around.

  3. Well, here's the view from the even cheaper seats, the remote seats.

    I agree with you completely, almost. I think you're spending your time working out how he's going to pay for it without raising taxes or increasing the deficit, but something else has to come first. Go back to the beginning.

    Will those job proposals actually make jobs?

    The short answer is: NO.

    He's going to give everybody money so that more teachers, firefighters, veterans, etc. can be hired. He's going to spend money on infrastructure (highways) etc. so construction workers can be hired. and on and on.

    But all these things are relatively short term fixes, like cold cream on measles. As soon as the federal money runs out, the jobs stop, and everybody in the country knows that. Banks know that, too. So will they make loans or mortgages based on short term jobs. No. Will businesses expand, build new factories, hire more workers based on short term money. No. Will everyone run out and buy a house? No. Why would they? They'll just lose it again.

    They'll spend this Federal money as long as he hands it out, and then crawl back in their holes. They won't invest, because they know the same old cliff is waiting at the other end of it.

    So, what would make someone try to buy a house? What would make banks begin to loan again?

    CONFIDENCE, MAN! Don't you see it? Confidence that this country is going to keep on perking and providing a good life for you and me. That markets will be there if I start a company. That our government will stop screwing up everything we try to do for ourselves. Confidence that someone's in charge that actually has brains and a sense of responsibility. And confidence that we actually have brains and can work our way out of this if government will just leave us alone to do it.

    But we need to shake off the shackles we've put on ourselves. We've unionized ourselves into a straightjacket. We've litigated ourselves into the poorhouse. We've got to fix these problems, so that we can move on. We have to have the guts to to get out of the dust, stand up and yell "We're back". Then do what's necessary even at personal cost.

    We did it before. That's how we started this place. And the world admired us for it. But somehow we've convinced ourselves that we should be ashamed of our beginnings, and it's strangling us.

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