It's the stupid jobs bill, stupid

It's jobs, stupid!Jobs. Jobs. Jobs. Washington’s focused on them like a laser. Yesterday, Harry Reid (soon to be former Democrat Senator from Nevada and current Majority Leader), announced the revised Senate bill designed for bi-partisan appeal and to help create the nine plus million jobs needed to offset just those that have been lost since the worst depression since the great one began.

The cost of the total package, according to estimates released by Reid, would be about $15 billion over 10 years. This is what he said was actually in the bill (I’m not making this stuff up):

  1. A payroll tax holiday that would waive the 6.2% Social Security tax for any employer who hires a worker who has been out of a job for at least 60 days. In addition, the bill would provide a $1,000 income tax credit for every new employee retained for at least 52 weeks.
  2. A tax break that would allow businesses to write off up to $250,000 in capital investments in 2010 rather than depreciating the costs over time.

Waiting for more? That’s it. Yeah, really. Nothing to help re-capitalize small businesses, which have historically pulled us out of economic doldrums and been the hiring engine that could. Nothing to spur consumption. Nothing for expansion. Nothing for training. Nothing to get the banks lending to business. Nothing to help with the crippling, double digit health insurance premium increases that have been announced. Nothing to help create jobs of those hardest hit groups or regions.

In fairness, there are other versions of the bill. One of those versions had bi-partisan support, an $85 billion price tag, extended unemployment benefits and would subsidize interest on bonds for local infrastructure products (a more expensive version of nothing). Reid pretty much squashed that.

They take this stuff really seriously up in Washington. This is their answer? Somebody get me a tea bag.

10 thoughts on “It's the stupid jobs bill, stupid

  1. Pingback: It's the stupid jobs bill, stupid by Lee Leslie | |

  2. Frank Povah

    Why oh why can’t he government itself embark on infrastructure projects that would employ people? Fibre optic-rollout for example. It could be sold to the private sector on completion with the proviso that it must not be mothballed. Reaforestation -- too touchy-feely greenie treehuggie perhaps? But necessary. There’s heaps need doing and we know the corporate sector won’t do it.

  3. Brenden

    Gov’t investments in telecom infrastructures are notorious failures. Technology simply changes too fast for the gov’t to keep up. If they purchase a $10 trillion in 2010 telecom technology upgrades, and this technology is obsolete in ten years (as we know it will be), that investment will be worth zero. Better left up to nimble private firms than cumbersome, incompetent gov’t.

    Also, there are more trees in North America now than when the Europeans arrived, largely because former Midwestern grasslands now have large forests. This was not so when Columbus arrived. There are plenty of trees east of the Mississippi. Go grow your gov’t trees in the outback — with Aussie money.

  4. Frank Povah

    Well, Brenden, aren’t we a cross little puppy today? What ‘s wrong? Frightened by a picture of FDR again? Must be, otherwise why so insufferably rude? Australia’s telecommunications infrastructure gave a better service, and employed more people and put more money into the national purse than it has done since it was privatized and raped by a coterie of the US pillagers the ilk of whom you so obviously admire, brought in for their expertise at running a modern company (read paying each other huge bonuses at company expense). More trees only in some places Brenden boy. I’d suggest what you know about ecosystems could be written in block letters on the back of a penny and still leave room for the Gettysburg Address. Have other Dewers noticed that Brenden’s rhetoric is eerily like that of a Mao Tze Dung or a Joseph Stalin except that Imperialist Running Dogs have become Snivelling Liberals and the Glorious Proletariat are now Noble Capitalist Financiers. His self-image as expressed by his avatars is also interesting. I breathlessly await John Wayne – or perhaps Nero.

  5. Lee Leslie Post author

    With certain exceptions (government workers, lobbyists, auditors), the government can’t create permanent jobs, but it can do somethings that help job creation in the private sector. It is my belief that the most critical need is small business financing. Problem, of course, is that any small business that needs access to financing can’t qualify for it. Expanding the money that is available through the SBA is a start. Some temporary subsidies of interest or more flexible terms would also help a bunch.

    I suppose I’m OK with some new hire tax breaks, but tying it to FICA seems an awful idea since it will only make things worse for poor old Social Security and 6.2% is way too little to be a deciding hiring factor and will likely only benefit companies who are hiring anyway.

    One of the unintended, though always expected, consequences of continuing to extend unemployment benefits, is that it mitigates the incentive of employment and at some point becomes welfare, but only for those who qualify -- doesn’t seem right, fair, smart and certainly isn’t sustainable.

    Some quasi-public works probably make better sense to replace extending benefits, but we are in a time when every state and municipality is subverting the goals of stimulus and job spending to pay for existing programs (or just building or re-building highways using private contractors who often use mostly undocumented workers). The trickle down consumption that comes from these programs will pay off, but take many years to pull off.

    Then there’s the capital investment write-off which makes a modicum of theoretical sense, but in practice will do little to help those who have no access to capital and are most likely to create new jobs.

    This is tough stuff when there is so much attention on the Federal checkbook. No time for pork, a bad time to waste and an awful time for the long-term program. I believe the focus needs to be on helping small business.

    If it were my economy, I’d start raising rates the Fed charges the banks and find a way to subsidize those rates temporarily for companies who would bet on businesses that create jobs, rather than just on Wall Street.

  6. Juli Ward

    I work for a small business owner. We are service oriented though not product oriented. But I know from doing everything that goes along with his business that payroll taxes, unemployment taxes and depreciable assets are negligible compared to what he pays in health insurance costs and lost revenue from folks that just do not have the funds. Health insurance needs to change somehow. I don’t know how that can be accomplished; however, I do know that some states and countries have created a system that seems to work. What is so wrong with following a system that does work? Of coure I understand that every system is going to have some downfalls. But if the cons outweigh the pros, go with it. Why are our legislators spending our tax dollars to ruminate on subjects that have been “figured out”? I can only guess it is the free lunch and CNN coverage of his/her useless poem/adage that fuels this debate. Special interest groups and PAC money don’t hurt either. But to help the small business owner you must lower health insurance costs somehow and give the “little” folks money to spend. Because they will spend it.


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