GOP Blocks Jobs initiative...

[patswin]

Originally Posted by deec77

Industrial jobs perhaps not. if we keep the unions involve in what's left of our industrial jobs no. It's not as simple as just lowering the corporate taxes. You will save a lot of small businesses by lower corporate taxes though. But otherwise if we continue to spend more the then we take in we are doomed.

~Dee~

It's more than controlling spending. It's how the hell do we pay down the debt?

[deec77]

Originally Posted by patswin

It's more than controlling spending. It's how the hell do we pay down the debt?

Like I said it's more then lowering taxes, controlling spending, paying done the debt, working, etc........ I agree with you 100%

~Dee~

[patswin]

Originally Posted by O_P_T

A few things to consider.

Yes, the labor costs in the US are higher than in much of the developing world, but they are lower than Europe.

Couple that with the fact that there still is a highly skilled workforce in the US and there are incentives for European countries to shift jobs to the US, ignoring the corporate tax issue.

So yes, dropping the corporate tax rate can make it fiscally attractive for a European company to shift to the US, especially if the US is one of their major markets.

Also, one thing to recall about China. They've been building a bunch of "ghost cities"

Do a google on "China Ghost cities" or "China phantom cities" to see some details.

Basically, they've helped keep their economy growing by building cities that nobody lives in.

They claim that they will eventually be filled as the economy continues to grow.

Are they right?

All I know is that you could also consider this program Keynes on steroids and a textbook example of a bubble.

If they stumble for any reason, then the whole thing could come tumbling down in a fashion that would make 2008 look like a minor market fluctuation.

OPT, some of these are not ghost cities. Big manufacturers like Foxconn are entire cities unto themselves. They employ hundreds of thousands, in a self enclosed world. Housing, factories, malls, restaurants, even schools. All owned by the factories. The workers never leave.

[BradyLady12]

Originally Posted by patswin

OPT, some of these are not ghost cities. Big manufacturers like Foxconn are entire cities unto themselves. They employ hundreds of thousands, in a self enclosed world. Housing, factories, malls, restaurants, even schools. All owned by the factories. The workers never leave.

The ghost cities are, from what I've seen, devoid of people though. They even have malls with display windows in the stores with merchandise. It's kinda ass backwards.

[O_P_T]

Originally Posted by patswin

OPT, some of these are not ghost cities. Big manufacturers like Foxconn are entire cities unto themselves. They employ hundreds of thousands, in a self enclosed world. Housing, factories, malls, restaurants, even schools. All owned by the factories. The workers never leave.

I'm not sure I understand you comment.

I didn't intend to suggest that 100% of all the cities built by China over the period of their rapid economic growth are "ghost cities" simply that some of them are.

My point is that China's growth and the stability of their economy are not necessarily as stable as it appears on face value.

It has some of the properties of any economic bubble. As long as growth continues at a relatively high rate, all is good. Should a hiccup occur, what then?

Heck, it was only a year or two ago when there were plenty of talking heads saying that the Euro was going to supplant the Dollar as the primary currency on world markets.

Who thinks that now?

[patswin]

Originally Posted by O_P_T

I'm not sure I understand you comment.

I didn't intend to suggest that 100% of all the cities built by China over the period of their rapid economic growth are "ghost cities" simply that some of them are.

My point is that China's growth and the stability of their economy are not necessarily as stable as it appears on face value.

It has some of the properties of any economic bubble. As long as growth continues at a relatively high rate, all is good. Should a hiccup occur, what then?

Heck, it was only a year or two ago when there were plenty of talking heads saying that the Euro was going to supplant the Dollar as the primary currency on world markets.

Who thinks that now?

We are in agreement... sorry if I seemed otherwise.... and yes, if that artificially propped up Chinese economy tanks... it's Great Depression time.

[Baron Samedi]

Originally Posted by AnOldTroll

Baron, I read your post above several days back and shared it with a bright young kid I know. I asked him to tear it apart if he could. This is what he wrote...


"The average Chinese minimum wage is around 1200 US dollars annually. When you or anyone you know are willing to work for that amount talk to me about competing with China. There are also many countries that have a much lower minimum wage that attract foreign businesses than China.

I know this post focuses on the corporate tax rate, but that is only part of the entire package of passing laws that favor corporate competitiveness. By cutting corporate taxes, we lose out on the profits of businesses that are located in America. Ya, we lost out on the call centers and all the unskilled labor that can be done effectively overseas, and that will happen. What we need to focus on is maintaining the skilled labor. Skilled laborers will stay in more advanced countries like America where they feel comfortable. American Engineering jobs, for example, aren't moving overseas to Indonesia.

What IS happening is that the rest of the world is managing to catch up on training skilled labor. Post Cold War America really gutted our funding of the sciences and education as we no longer viewed ourselves in a race against the Soviets. Because of this we have fallen behind, and at the same time places like Singapore and China have invested heavily in these fields and are nearly caught up, and able to produce these skilled laborers in larger quantities.

You want more (real) jobs? Rather than cutting initiatives like NASA, invest more heavily in them. Not only do these provide high end jobs, but youth can aspire to educate themselves for such a role. Growing up post Cold War, my generation has never been to the moon, and we have at this point grounded our space fleet. In some aspects the technology of the past is more advanced than the tech of the present or perceived future.

If you want lower end jobs, invest in infrastructure. Construction alone creates many decent jobs. Having a lower corporate tax rate won't help this type of initiative. American infrastructure has to be built in America."


So my questions to you are

Will lowering the corporate tax rate get americans "real" jobs or just get us working again?

Is the American dream still possible in this global economy?

One thing I know, we have to reign in our federal government for anyone to have real opportunity,

Minimum wage outlaws lower end jobs.

That is a fact that is undeniable, and the hardest hit by it are the poor and minorities, who lose jobs at a 2 to 1 ratio when minimum wage is raised.

There is no doubt about that.

However, minimum wage jobs are almost ALWAYS service industry jobs, which can't be exported. What happens is that fewer of those jobs become available.
Restaraunts cut staff...maybe they used to have a hostess at the door that they cut.
Gas stations stop washing your windows and checking your oil.
Grocery stores have fewer people stocking shelves and gathering shopping carts from the parking lot.

That is an issue, bu it was not the issue I was addressing.

What I was addressing, in shortform, is that if you are an American company, and you make profits, you have to pay the average 39.2% taxes on those profits.
That means you have 40% less revenue to reinvest in the company. Growth comes from reinvesting your profits back into your company.

Now, if we were in a bubble, everyone would be on the same playing field.

But we are not.

Multinational corporations can an do operate here in the US....minimum wage notwithstanding because most of these jobs would be higher paying than minimum wage, anyway.

BUT....the multinational corporation has the ability to shift profits from place to place, thereby vastly reducing overhead and giving it a huge advantage over domestic companies.

So...the question is, where do these profits get sent to? Places with the most forgiving tax code.

It is quite literally exporting wealth.

It is very difficult for a company to actually grow in the US, and they are competing with a handicap vs foreign corporations.

[tehmackdaddy]

Originally Posted by Baron Samedi

Minimum wage outlaws lower end jobs.

That is a fact that is undeniable, and the hardest hit by it are the poor and minorities, who lose jobs at a 2 to 1 ratio when minimum wage is raised.

There is no doubt about that.

However, minimum wage jobs are almost ALWAYS service industry jobs, which can't be exported. What happens is that fewer of those jobs become available.
Restaraunts cut staff...maybe they used to have a hostess at the door that they cut.
Gas stations stop washing your windows and checking your oil.
Grocery stores have fewer people stocking shelves and gathering shopping carts from the parking lot.

That is an issue, bu it was not the issue I was addressing.

What I was addressing, in shortform, is that if you are an American company, and you make profits, you have to pay the average 39.2% taxes on those profits.
That means you have 40% less revenue to reinvest in the company. Growth comes from reinvesting your profits back into your company.

Now, if we were in a bubble, everyone would be on the same playing field.

But we are not.

Multinational corporations can an do operate here in the US....minimum wage notwithstanding because most of these jobs would be higher paying than minimum wage, anyway.

BUT....the multinational corporation has the ability to shift profits from place to place, thereby vastly reducing overhead and giving it a huge advantage over domestic companies.

So...the question is, where do these profits get sent to? Places with the most forgiving tax code.

It is quite literally exporting wealth.

It is very difficult for a company to actually grow in the US, and they are competing with a handicap vs foreign corporations.

The company still controls the earnings after it has been taxed at a favorable rate in another country.

[Jaric]

Originally Posted by patswin

It's more than controlling spending. It's how the hell do we pay down the debt?

Maybe we could borrow some money to pay it off?

[BradyLady12]

Originally Posted by patswin

It's more than controlling spending. It's how the hell do we pay down the debt?

With QE1, 2 and 3 because we pay it back with cheaper dollars.

[O_P_T]

Originally Posted by Jaric

Maybe we could borrow some money to pay it off?

Why don't we just transfer the markers we have from all the money we loaned in the first 3/4 of the 20th century?

[patswin]

Originally Posted by Jaric

Maybe we could borrow some money to pay it off?

Yeah, sort of like the balance transfer game with all those credit card offers that come in the mail to every mailbox.

[O_P_T]

Interesting tidbit from the Progressive Policy Institute.

Unfortunately, U.S. business investment tanked during the Great Recession, and has yet to recover. The graph below shows the extent of the drop-off—in 2011, non-residential investment remained more than 7% below 2007 levels, adjusting for prices. By comparison, personal consumption in real terms was higher in 2011 compared to 2007. We find ourselves in an investment drought, not a consumption drought.

Equally as important, before the recession companies were expanding their domestic investment at a rapid pace. In fact, we estimate there would have been a total of $1.4 trillion more in non-residential business investment over 2008-2011, in 2005 dollars, had business investment continued to grow at the same average annual rate in the ten years before the recession (4.8% over 1997-2007). That extra investment could have gone a long way creating jobs, boosting productivity, and enhancing U.S. competitiveness.

The decline and lackluster recovery in business investment has a wide range of causes, including globalization, regulatory barriers, and weak demand. Many companies are investing overseas rather than in the United States. Multiple layers of regulation, even if well-intentioned, have the impact of discouraging capital investment and innovation. And the continued weakness in demand at home makes it difficult to justify building new factories. But no matter what the reason, this weakness is having an adverse effect on economic growth and is one of the main reasons behind the job drought.

So the Progressive Policy Institute" cites regulation as one of the reasons for a lack of investment by businesses in the US, and thus the lack of recovery from the recession.

Clearly they've been hacked or brainwashed to repeat such a clear GOP talking point.