All day on the radio today I've been hearing news briefs previewing Obama's big job speech tomorrow. According to Bloomberg, “The main components of Obama’s jobs plan... have been largely telegraphed by the administration. For weeks, people familiar with deliberations have said the White House is considering tax incentives, infrastructure and assistance to local governments.” Excuse me? Are they serious? It sounds like more of the same to me.
The “center piece” of the plan is supposed to involve extending the cuts in the payroll tax. Hmmm. Let's see. Obama offers a “payroll tax holiday” to spur job growth, it hasn't worked thus far, so the center piece of his new plan is to extend them? Yep, that sounds like Democrat economics all right.
What's new is that in this plan, he's supposed to include a reduction in the employer paid portion of the tax. I don't see how that's going to make a difference. Temporary incentives never work. Why would they? If you give a temporary incentive to an employer to hire someone, the employer knows that next year he will no longer receive the incentive yet he's still stuck paying the employee.
The second point, according to Bloomberg, is spending on infrastructure. I suppose this is like those “shovel ready” projects that were just waiting to be funded with the last stimulus package. As Obama has laughingly admitted, they “were not as shovel ready as we expected.” I'm sure he's a lot more optimistic about these new projects.
One news report suggested some of the money for infrastructure would be used to repair and update public school buildings. Once again, this is a temporary fix. If I own a construction company and I hire a few workers to help repair an old building, once the building is done the workers will go.
And did I read that correctly? Did Bloomberg really suggest that part of the jobs plan includes “assistance to local governments”? I don't see how funding teachers' unions and bloated government workers' pension plans will create jobs but I'm sure it will result in a lot of grateful voters next November.
The funniest thing I heard on the radio all day was how Obama intends to pay for all this. The report said he will offset the programs with “future deficit reductions.” That is a riot. That would be like me personally saying, “I'm going to borrow $200,000 now and I'm going to pay it back by borrowing less later.” You can see how that doesn't quite work.
I'm sure somewhere in the speech he'll also be blaming Bush and the Republicans. Right after the election, I predicted that Obama would continue for a while to blame Bush. I had no idea, though, that he would continue blaming him 3 years later.
Maybe I'm putting the cart before the horse. Maybe I should wait until I hear the President's plan before I comment on it. Maybe the President has some good ideas about how to create jobs. I just wonder why he's waited until now to present them. I guess he wanted to try placing a moratorium on offshore oil drilling and promoting “green jobs” first.