How Not to Create Jobs

Part of the President's job speech last night proposed increasing taxes on wealthy Americans & CEO's (i.e. “employers”) and extending benefits to unemployed people. It sounds a little strange to me. Once again I suggest it might benefit our elected officials in Washington to brush up on economics. Let me give a thumbnail:

We work to make money, right? It's nice if we enjoy our jobs but if we don't get paid then it's not a job – it's a hobby. We work for a paycheck. When we get paid, we pay our bills. We pay our rent or mortgage, our car payments, we buy gas, we buy groceries, etc. We also have disposable income that we use for our enjoyment: we go out to dinner, we buy video games, we go to the movies, we take vacations, or whatever. When we spend our paychecks, we're helping to pay other peoples' paychecks. We pay for the salaries of people who work at the gas stations, the grocery stores, the restaurants, the theaters, etc. When they get paid, they spend the money much the same way as everybody else. In short, I work to produce goods or services so that I can buy goods and services that other people work to produce. This IS the economy!

With unemployment so high, we have a lot of people who aren't producing goods or services. They are removed from an important part of the equation. There is “less economy” when more people aren't working. The economy is only sustained by the people who are still working and producing. So what is the President's solution? It seems that part of his solution is to take more money from the people who are working and sustaining the economy and give to the people who are aren't contributing to the economy!

It would almost be laughable that Democrats think this way but the effect of their policies is so tragic. I've heard Democrats, more than once, claim that paying unemployment benefits to non-producing individuals is the most “bang for the buck” in stimulating the economy. With staggeringly high unemployment and people already receiving benefits for 99 weeks, we should have climbed out of this pit a long time ago but we're still limping along. Now the President has suggested extending unemployment benefits another year? I'm telling you that is part of the problem. People aren't working because they don't have to and the economy isn't growing because so many people aren't producing.

If you want to make the claim that we need a safety net for people suddenly out of work then make that argument. It might be reasonable to help people but it should only be for a few months. If you enable people to remain unemployed then we're merely sustaining their poverty. I've written before how the Bible suggested we handle the problem: if an able bodied man doesn't work, then neither let him eat! When people aren't getting a government check each week for not working, and they have to decide between ANY job and starving, I guarantee you they'll take ANY job.

My advice to the President and all other Democrats out there is to drop the idea that taxing producers to pay non-producers can create jobs. It was a joke in 2009 and it's an old joke now.