I’m putting this question here because I’m not looking for a debate, although I won’t be surprised if it turns into one.
Yesterday a thought occurred to me. When it comes to Republicans the most common method for creating jobs and stimulating the economy is to give businesses tax breaks in the hopes that they will use the savings to hire more people.
Democrats are generally against this, but yesterday I realized that I don’t know what the Democratic way of creating jobs and stimulating the economy is.
So, what is the common Democratic way of creating jobs and stimulating the economy? Thank you.
Increase government spending to generate jobs and increase consumption. Like, fix highways and bridges, upgrade government buildings to make them more energy efficient, spread broadband to rural areas, all that sort of stuff that was emphasized in the 2009 stimulus bill.
No, when the government builds a bridge, construction companies bid for the work. Whichever wins, they will hire additional people to do the work. Those are not government jobs.
Isn’t that kind of a temporary solution though? I mean, after the bridge is built, for example, some people will be absorbed into the construction company as regular employees, but it seems like many would be laid off once the project was complete. And then they would have to wait until another government project comes along. Or am I missing something?
While those people are working, they are buying groceries, TVs, cars, and iPhones. This provides an increase in consumption that helps Safeway, Best Buy, your local Ford dealership, and Steve Jobs to hire more people.
The construction workers are also paying taxes on their wages.
The temporary nature of increased spending is a feature, not a defect. If you cut tax rates and another recession happens, what are you going to do, cut rates again? Th government has to balance it’s budget. Additional spending to provide a temporary increase in employment and consumption means that you don’t have to keep the stimulus going in perpetuity, like many would expect of a tax cut. When the need for stimulus runs out, stop additional spending, pay off the deficit, and let free enterprise do it’s thing until the next crisis comes along.
That’s how it is supposed to be in theory, anyways.
Most jobs are temporary. When we chop down a forest, it will end when we run out of mature trees. When we drill for oil. Once the oil is reached they have to move on. Buggy whip manufacturers have been on hard times when they once ruled . Thousands worked in auto plants. Now they are poor.
If you are running a business properly you do not need any more employees. If your demand grows ,you may have to hire people . But dropping a ton of money in the lap of the owners will not cause them to hire anybody. it would be stupid and poor management.
Gee, I just got a huge tax break. i think i will hire a bunch of people to stand around and do nothing.
One historically good method has been to concentrate on new technologies–the car and attendant road building, housing after WWII and the growth of the suburbs, computer and IT, and right now we could jump start the fuck outta the economy by upgrading the electrical grid with smartgrid tech and start getting heavily into green energy. Manufacture wind turbines and solar panels here, wave generators, rooftop solar and vertical shaft wind generators that put electricity back into the grid when the house doesn’t need what’s being produced–just think how much more disposable income we’d all have if we didn’t have to spend so much on heating and cooling our houses and recharging our electric cars. Then get into tiny town sized nuke plants and we could get off the oil economy that’s bankrupting us. You’ll notice that every attempt to manage these sorts of projects is blocked almost immediately by GOP congresscritters who’re in the pockets of Big Oil and the coal industry.
You have encountered the conflict between capitalism and inventiveness. Capitalists do not want to invest in technology unless they are forced to. they have no need to push the envelope. What they want to do is end competition. They do that with mergers and buying up the competitors. American capitalism is not the engine of change but the power of status quo.
Our internet speed and technology is lagging badly. We have to upgrade in order to stay within shouting range of the industrial world. Since 2000 the cable companies were allowed to add 5 bucks a month to cable bills in order to upgrade the lines. They did not do it. they just kept the money. There are few internet providers in America and they do not compete except by advertising. Same old shit ,same price. We are falling back on speed. It is not because industry and other users would not like to have faster connections, but because there are no forces acting on the companies to provide it. There is no small provider offering greater speeds. If one popped up, Comcast would buy them out and bury them. Capitalism wants to increase short term profits. that is done by controlling the market, not competing.