Harry Reid Fact Checked But It Won’t Change Faulty Worldview
December 27, 2011 4 Comments
Forbes had a big splash over the weekend fact checking Sen. Harry Reid’s ridiculous assertion that millionaires don’t create jobs. Using the government’s own data, Forbes surmised that most millionaires do in fact create jobs and that of the 250,000 who earned a million or more in 2009 only 16,000 or so of them were the hedge fund managers and lawyers that Reid cited as being the only millionaires. Forbes rightly points out that even if Reid was correct about hedge fund managers and lawyers being the only millionaires, it’s not like they don’t hire secretaries and other staff to work for them. Thus they create jobs.
The problem here is that Forbes misses the boat completely. They’re allowing facts to cloud a worldview. The pesky facts, which any fool could have come up with, were never going to side with Reid on this issue. It is absurd to suggest that those who earn a million or more a year don’t create jobs. Especially in light of the fact that this income group earned $600+ billion. They either created jobs with their wealthy or they’re swimming in gold coins like Scrooge McDuck. Don’t laugh, there are liberals out there who really believe the millionaires and billionaires out there are swimming in gold coin money bins, Harry Reid is one of them.
The real problem though is that Reid is a progressive and as such he doesn’t believe the private sector creates jobs. He believes government creates jobs. This goes right in line with Obama’s top down approach to the economy. Decisions are made in Washington and the government is directly responsible for any and all job creation. If jobs are lost, the progressives in government whine about evil hedge fund managers and greedy lawyers and businessmen. This is one reason why Obama spent the better part of his first two years claiming the government “saved or created” millions of jobs. It’s because the progressives really believe it.
We in the GOP need to be careful not to fall into this trap. Bush spent his entire administration claiming he created millions of jobs. Lots of conservatives like to point to Reagan, claiming he created tens of millions of jobs. Bush, Reagan and the government did no such thing. Government doesn’t create private sector jobs. Private sector jobs are created by investors who foresee demand for certain services or products or by demand itself.
Government can only create conditions that are good or bad for job creation. But at the end government doesn’t create the jobs, the market does. High taxes and heavy regulation, both supported by Obama and the progressives, hinder job growth. It creates conditions that make the c0st of hiring overly expensive and thus risky. On the other hand, lowering taxes and reducing regulations can have the opposite effect. Lower taxes and lower costs create ripe conditions for job growth. But at the end of the day, it isn’t an act of government that creates a job. It’s businesses that create the job.
We conservatives need to be careful about giving to much credit to government concerning job creation. We to easily fall into the progressive trap by claiming that Rick Perry created a million jobs in Texas or that Jon Huntsman created jobs in Utah. Those men and all other Republican governors and presidents did no such thing. They may have created conditions that were good for job growth by reducing taxes and regulations. But they didn’t create the jobs, the private sector did. By falling into the progressive trap, to many Republicans falsely believe that government creates jobs. This is how the left wins and shifting the country ever leftward. Let’s not continue falling into this trap.
About Steven
Good post, Steven. It is important that we keep your point in mind. The only jobs government can create is government jobs. They can not create real and productive jobs, only the environment that helps the private sector create jobs.
When government creates government jobs it’s always important to note that they have to take resources from the private sector in order to create those jobs. Those resources come in the form of both taxes and manpower/brains.
Government does create jobs: Without infrastructure there is no economy. Without regulation the economy grinds to a halt. There is no such thing as a self made man. If Americans did not live by the rule of law and deal honestly and fairly with each other our economy would be similar to Mexico’s. That some people can accumulate more wealth then others is just the difference in human nature.As long as people believe that our system is fair, rewarding those who deserve to be rewarded and not taking from those who cannot afford to give then it will function well. When people hear that people like Mitt Romney pay a 14% income tax rate while the middle class pays a much higher rate then no one is going to believe the system is fair. This is not a liberal verses conservative issue. Why the hell should we cripple our military with budget cuts when super rich people like Romney pay little in taxes. An just how long do you think this country is going to remain the best country in the world to live in when we have a few well off rich folk and the rest living on crumbs? That is a recipe for a third world country like Nigeria. Henry Ford paid five dollars a day so people could buy his cars. If we have no money then we can’t buy anything that the rich would like us to buy. And just what regulations are you going to cut? The ones that guarantee that your home drinking water is not poison? Don’t you think we would be much better off with China’s unregulated market place? Then we could bury American babies from contaminated infant formula just like the Chinese. Yes, those Chinese sure no how to make money in free enterprise. We could learn from them.
Government’s job is to make sure that rights are protected. If someone has violated a contract, it’s within the government’s power to enforce the contract if the harmed party wishes it. I’ve never called for no regulation, I’ve called for limited regulation.
Have you never heard of private infrastructure? Take a look at the private Grand Northern Railway and compare its peaceful and less expensive creation to the government funded Transcontinental Railroad. Originally telegraph, telephone and electricity lines were private. Recently cable tv lines were largely private. There can be private infrastructure and it’s almost always cheaper and more efficient than government funded.
Mitt Romney pays 15% on his capital gains, which is made on money he risks in the marketplace. He gets no deduction if he loses that money. (the max deduction is around $5,000 for a loss which we’ll agree is nothing for someone like Romney) The truth is middle class Americans don’t pay 15% in income tax. The truth is that 97% of Americans pay less than 15% in income tax. The truth is that around 48% of Americans pay no income tax at all. So if people get all bent out of shape over Romney’s tax rate, it’s because they don’t know the facts.
China actually has a highly regulated marketplace. They just don’t regulate what they ship overseas. Try opening a business there, the red tape is apparently incredible.