Top Obama Adviser: Unemployment Won't Be Key in 2012

[Conservative]

tax rates aren't the primary reason businesses aren't hiring. Especially since they are at a historically low level.

Uncertainty, regulations, the cost of Obamacare, potential for higher taxes, and massive growth in govt. is keeping employment low and Obama has no plans to change.

 

[Swizz]

LOL, typical liberal response and wrong. 1.7 trillion added to the debt vs. the 900 billion that Reagan inherited isn't worse than the Carter economy particularly when GDP Doubled, Govt. revenue from tax cuts doubled, and 18 million jobs were created after a disastrous first two years due to a 20 misery index. Debt service on the debt is much worse on the 4 trillion than the 1.7 trillion and both are funded by the taxpayers.

I said fiscally. Said nothing about the misery index or jobs, we're talking strictly about deficits. But I'm not surprised you want to change the subject.

 

[Conservative]

I said fiscally. Said nothing about the misery index or jobs, we're talking strictly about deficits. But I'm not surprised you want to change the subject.

Deficits added together make the Reagan debt 1.7 trillion which is what we pay debt service on, Obama deficits have been close to 4 trillion which we pay debt service on. Which one costs the taxpayer more, debt service on 1.7 trillion or debt service on 4 trillion? Trying to keep a liberal on topic is the hard part. I don't change the subject at all but liberals want to divert back to Reagan and Bush all in an attempt to ignore the Obama record.

 

[pbrauer]

They can cut taxes so that businesses will start hiring again.

Tax cuts has never caused hiring and never will. Businesses hire people when there is demand for their products and services that warrants the hiring. That's the way capitalism works. People have money in their pockets, so they buy stuff, businesses hire people to satisfy the demand. Tax cuts go into the banks until the demand it up.

 

[Conservative]

Tax cuts has never caused hiring and never will. Businesses hire people when there is demand for their products and services that warrants the hiring. That's the way capitalism works. People have money in their pockets, so they buy stuff, businesses hire people to satisfy the demand. Tax cuts go into the banks until the demand it up.

So what did you do with the extra take home pay because of tax cuts? Think having a little extra money created more demand for jobs? Hmmm

 

[Misterveritis]

Norly. What can the government do to lower unemployment?

This is remarkably simple to do. We want to do things to increase private sector employment.
1) Reduce tax rates across the board.
2) Lower capital gains tax rates to 10%.
3) Reduce the tax rates corporations pay to below the level of any other country in the developed world.
4) Make repatriated money taxable at the same low rates as in #3.
5) Eliminate all public sector unions.
6) Eliminate all regulations that were published after Jan 1 2008.
7) Return government spending to Jan 2008 levels.

Longer term scrub all of our laws. Anything that is not explicitly allowed by the enumerated powers of the US Constitution should be repealed.
Add a balanced budget amendment to the US Constitution.

Randomly select and execute every 10th politician. (well, okay, this might not directly effect employment but it would improve the mood of the country... )

 

[Deuce]

6) Eliminate all regulations that were published after Jan 1 2008.

Is there something about that date that made regulations turn inherently bad? Were regulations perfect on Dec. 31, 2007?

 

[Conservative]

This is remarkably simple to do. We want to do things to increase private sector employment.
1) Reduce tax rates across the board.
2) Lower capital gains tax rates to 10%.
3) Reduce the tax rates corporations pay to below the level of any other country in the developed world.
4) Make repatriated money taxable at the same low rates as in #3.
5) Eliminate all public sector unions.
6) Eliminate all regulations that were published after Jan 1 2008.
7) Return government spending to Jan 2008 levels.

Longer term scrub all of our laws. Anything that is not explicitly allowed by the enumerated powers of the US Constitution should be repealed.
Add a balanced budget amendment to the US Constitution.

Randomly select and execute every 10th politician. (well, okay, this might not directly effect employment but it would improve the mood of the country... )

You have my vote. Our govt. should also deduct from foreign aid or bill foreign countries for illegal alien healthcare

 

[Misterveritis]

Is there something about that date that made regulations turn inherently bad? Were regulations perfect on Dec. 31, 2007?

If you prefer an earlier date let's go with it. Any earlier date will do. Maybe we should sunset them all and start over.

 

[BDBoop]

I think I shall take that quote out of the vacuum in which it currently resides.

What did David Plouffe really say about unemployment? - The Plum Line - The Washington Post

 

[pbrauer]

I think I shall take that quote out of the vacuum in which it currently resides.

What did David Plouffe really say about unemployment? - The Plum Line - The Washington Post

What he said was people are not going to look at the employment rate and decide how to vote.

QUESTION: Axelrod likes to say that every campaign has inherited [inaudible]. You know, an environment in which unemployment is [inaudible] percent when the president runs for re-election, what’s — what’s the Obama narrative about that?

PLOUFFE: Well, listen, I don’t -- you know, we’re a long way from 2012. We’re a long way from knowing what’s going on in the world and exactly what the economy is and who are opponent is.

I would make a general statement, though, because there is a lot of attention focused on the unemployment rate. The average American does not view the economy through the prism of GDP or unemployment rates or even monthly jobs numbers. ...

 

[cpwill]

Tax cuts has never caused hiring and never will. Businesses hire people when there is demand for their products and services that warrants the hiring

this is a bit off. Businesses hire people when they figure out how to make a profit by doing so. Raise the tax on them doing so, you lower the potential for profit, you lower the incentive to hire because you decrease the reward while the risk remains the same.

as some rough basic back-of-the-letter math, let us say that by hiring Bob, I think I can incur an expense of $50,000 a year, for which I guesstimate that I have an 80% chance of seeing an increase in my productivity by $65,000. My possibility of profit is 15K * 80-50 (the break-even point for risk)%. I am betting $50,000 for a $4,500 possibility of profit ( or, (p)Profit ). that's 9% return to risk. I am willing to accept a 20% risk of total loss of money in this scenario.

But we are forgeting about taxes. In fact, my productivity is taxed at 35%, and let us say I rate a few reductions that pulls that down to 20% effective. So in fact, my net profit on Bob isn't $15K, it's $12,000. Which means that now I am looking at risking $50,000 for a $3,600 possibility of profit, meaning it is 7.2% (p)Profit. I may not be willing to take on a 20% risk of total loss of $50,000 - and if you simply get rid of all the deductions that pulls me down to hit me with a 35% effective tax rate, my p(Profit) becomes 5.85%. I am very unlikely to risk $50K with a 20% possibility of total loss at that point. At that point, I am better off keeping the money and socking it into an S&P 500 Index fund.


there is probably something much better out there that describes what i just attempted to - but there is the basic thrust. Employers are measuring risk of loss against potential gain. Lower the potential gain through taxation, and you reduce their tolerance for risk, which means they will take less of it on new employees and seek out more stable forms of investment such as machinery.

 

[cpwill]

What he said was people are not going to look at the employment rate and decide how to vote.

that is correct. we are far too stupid and shortsighted to realize how badly they have @)#_#'d things up.

 

[haymarket]

This is remarkably simple to do. We want to do things to increase private sector employment.
1) Reduce tax rates across the board.
2) Lower capital gains tax rates to 10%.
3) Reduce the tax rates corporations pay to below the level of any other country in the developed world.
4) Make repatriated money taxable at the same low rates as in #3.
5) Eliminate all public sector unions.
6) Eliminate all regulations that were published after Jan 1 2008.
7) Return government spending to Jan 2008 levels.

Longer term scrub all of our laws. Anything that is not explicitly allowed by the enumerated powers of the US Constitution should be repealed.
Add a balanced budget amendment to the US Constitution.

Randomly select and execute every 10th politician. (well, okay, this might not directly effect employment but it would improve the mood of the country... )

What about repealing the 20th century? How did that not make the list?

 

[cpwill]

What about repealing the 20th century? How did that not make the list?

cute, but portions of the 20th Century that you are referencing mostly don't need to be repealed; they can be reformed. if we do it in time.

 

[sangha]

Reagan alone and no President can raise deficits without the help of Congress. President's cannot spend a dime without Congressional approval, basic civics. As I have stated and continue to state, spending causes deficits not tax rate cuts. Reagan tripled the debt from 900 billion to 2.6 trillion or a 1.7 trillion debt. Obama increased the debt from 10.5 trillion to 14.4 trillion or 3.9 trillion which is about a 40% increase, which one is worse?

Why do you and others continue to ignore the Obama record

Funny how " no President can raise deficits without the help of Congress" but "Obama increased the debt from 10.5 trillion to 14.4 trillion"

 

[sangha]

Lower tax rates do not create jpbs; they destroy jobs
CHART: Lower Taxes On The Rich Don’t Lead To Job Growth | ThinkProgress

Lower tax rates do not strengthen the economy; it weakens it
CHART: Since 1950, Lower Top Tax Rates Have Coincided With Weaker Economic Growth | ThinkProgress

States that cut spending do not create jobs, they lose jobs


CHART: States That Cut The Most Spending Have Lost The Most Jobs | ThinkProgress

 

[pbrauer]

this is a bit off. Businesses hire people when they figure out how to make a profit by doing so. Raise the tax on them doing so, you lower the potential for profit, you lower the incentive to hire because you decrease the reward while the risk remains the same.

as some rough basic back-of-the-letter math, let us say that by hiring Bob, I think I can incur an expense of $50,000 a year, for which I guesstimate that I have an 80% chance of seeing an increase in my productivity by $65,000. My possibility of profit is 15K * 80-50 (the break-even point for risk)%. I am betting $50,000 for a $4,500 possibility of profit ( or, (p)Profit ). that's 9% return to risk. I am willing to accept a 20% risk of total loss of money in this scenario.

But we are forgeting about taxes. In fact, my productivity is taxed at 35%, and let us say I rate a few reductions that pulls that down to 20% effective. So in fact, my net profit on Bob isn't $15K, it's $12,000. Which means that now I am looking at risking $50,000 for a $3,600 possibility of profit, meaning it is 7.2% (p)Profit. I may not be willing to take on a 20% risk of total loss of $50,000 - and if you simply get rid of all the deductions that pulls me down to hit me with a 35% effective tax rate, my p(Profit) becomes 5.85%. I am very unlikely to risk $50K with a 20% possibility of total loss at that point. At that point, I am better off keeping the money and socking it into an S&P 500 Index fund.


there is probably something much better out there that describes what i just attempted to - but there is the basic thrust. Employers are measuring risk of loss against potential gain. Lower the potential gain through taxation, and you reduce their tolerance for risk, which means they will take less of it on new employees and seek out more stable forms of investment such as machinery.

Taxes are just another cost of doing business such as labor, so if need be the cost is passed to the consumer. If people are buying widgets, you can be sure somebody hiring people to create and sell them.

 

[cpwill]

Taxes are just another cost of doing business such as labor, so if need be the cost is passed to the consumer. If people are buying widgets, you can be sure somebody hiring people to create and sell them.

you are correct that all costs must eventually be born by the consumer, but you fail to note that the goods I am selling exist on a supply/demand curve. If my prices go up, demand for my product will go down, and I will sell fewer of them. Not only am I unable to hire new people, I may have to fire some of the employees I have currently.

Potentially I will be driven out of business by my competitor, who was smart enough to see this coming and fire lots of his employees and replace them with automation. You noticed the growth in self-checkout lately? Ever put it together that those started coming out when Congress started raising the minimum wage? Now Obamacare is going to slap more costs on employment, so McDonalds and CVS are moving into self-checkout, soon to be followed by the rest of their respective industries.....

mind you, the middle managers and whatnot will still be fine. only the most vulnerable, least skilled, lowest income workers will really be hurt by the increase in the cost and risk of labor.

 

[sangha]

you are correct that all costs must eventually be born by the consumer, but you fail to note that the goods I am selling exist on a supply/demand curve. If my prices go up, demand for my product will go down, and I will sell fewer of them. Not only am I unable to hire new people, I may have to fire some of the employees I have currently.

Potentially I will be driven out of business by my competitor, who was smart enough to see this coming and fire lots of his employees and replace them with automation. You noticed the growth in self-checkout lately? Ever put it together that those started coming out when Congress started raising the minimum wage? Now Obamacare is going to slap more costs on employment, so McDonalds and CVS are moving into self-checkout, soon to be followed by the rest of their respective industries.....

mind you, the middle managers and whatnot will still be fine. only the most vulnerable, least skilled, lowest income workers will really be hurt by the increase in the cost and risk of labor.

If your competitor does a better job of changing with the times, then you should go out of business. Then, your competitor will steal your clients, and hire your ex-employees to do the work. As far as automation goes, some places are getting rid of their self-checkout machines. Turns out, with all the expensive repairs they need, they arent very efficient. And Congress has raised the minimun wage many times, with increased employment following the increases.

Tax cuts and increases do not create or destroy jobs. The major factor that determines how many jobs there are is demand. If something is in demand, someone is going to make money selling it. If there's no demand, no amount of business saavy will make it a viable business.

 

[cpwill]

If your competitor does a better job of changing with the times, then you should go out of business. Then, your competitor will steal your clients

that is correct!

and hire your ex-employees to do the work

that is sadly incorrect. he beat me because I stuck with inefficient labor, remember?

Tax cuts and increases do not create or destroy jobs.

that is also correct - they only make it easier for employers to create jobs.

The major factor that determines how many jobs there are is demand.

this is partially incorrect - demand is a function of supply.

 

[sangha]

that is correct!



that is sadly incorrect. he beat me because I stuck with inefficient labor, remember?



that is also correct - they only make it easier for employers to create jobs.



this is partially incorrect - demand is a function of supply.

Your competitor will still have to hire some portion of your ex-employees. The ones he won't hire are the ones who are not needed. Businesses are not welfare offices. They hire what they need. Doing otherwise only hurts those who should be employed, as your mismanagement of your business demonstrates

And tax cuts have never created jobs. Both bush* and BO cut taxes..where are the jobs?

And no, demand is not a function of supply. People demand food and water, regardless of the supply

 

[American]

Schools districts are a part of the government. And now even that grand ole bastion of Republicanism Highland Park is going after federal funds.

And they likely actually paid those taxes, unlike some you might know.

 

[cpwill]

Your competitor will still have to hire some portion of your ex-employees.

:shrug: maybe a few. depends on the structure of the industry - he may simply choose to go with a business model that works, and invest in more capital to handle the increased business. the result is the same. by increasing the cost of labor, you push industry to stop purchasing it.

And tax cuts have never created jobs. Both bush* and BO cut taxes..where are the jobs?

you are mistaking tax cuts for tax credits. tax credits are one-offs; just another side of Keynesian stimulus, designed to "put more money in people's pockets so they buy more"; and in a high debt economy such as ours, it simply won't fulfil it's intended function. tax cuts are changes to permanent rates that allow employers to make predictions about future costs that they can feel relatively confident in. I'm a lot less likely to hire someone that I can only afford for the next few months if the cost of employing them will go up after that.

between no one knowing what the tax rates will be in two years, no one knowing what new giant heaping of regulatory burdens are coming down the pike, and no one knowing how much Obamacare is going to cost them; of course people aren't hiring. there is no predictability.

stable, low taxes don't create jobs - that is true. they simply make it easier for employers to do so.

And no, demand is not a function of supply. People demand food and water, regardless of the supply

yes, but they can only trade for them what they have. people will always demand more of both, whether the food becomes tastier, or healthier, or more, or served on fancier platters, and whether the water is stream, or tap, or bottle, or delivered to them by a topless amazon goddess. DEMAND in the theoretical is infinite. However, Demand as it is expressed in the economy is only a function of what supply we have to trade to meet our Demand.

 

[sangha]

:shrug: maybe a few. depends on the structure of the industry - he may simply choose to go with a business model that works, and invest in more capital to handle the increased business. the result is the same. by increasing the cost of labor, you push industry to stop purchasing it.

I bet you can't name one example of a business picking up a large amt of business from a newly defunct company without needing to hire any new employees to handle the workload. If a company has fully automated the process, then the defunct business would never have been able to be in business in the first place. Basically, you've made an argument that is theoretically possible, but in real life is completely improbable.

you are mistaking tax cuts for tax credits. tax credits are one-offs; just another side of Keynesian stimulus, designed to "put more money in people's pockets so they buy more"; and in a high debt economy such as ours, it simply won't fulfil it's intended function. tax cuts are changes to permanent rates that allow employers to make predictions about future costs that they can feel relatively confident in. I'm a lot less likely to hire someone that I can only afford for the next few months if the cost of employing them will go up after that

.

Wrong. We are talking about tax cuts. And tax cuts dont create jobs. And every business owner knows that tax rates change regularly. Uncertainty is a part of doing business. If a business owner can't handle uncertainty, they have no place running a business. And a raise in income tax rates does not turn a profitable employee into an unprofitable one because income tax only applies to the profits an employee brings in. Income tax increases can result in a lower return per employee, but unless the income tax rate exceeds 100%, the employee will still be able to afford them because every business can afford a profit.

between no one knowing what the tax rates will be in two years, no one knowing what new giant heaping of regulatory burdens are coming down the pike, and no one knowing how much Obamacare is going to cost them; of course people aren't hiring. there is no predictability.

Uncertainty is part of doing business. No business can gaurantee that it will be in business next year. If a business owner can't deal with uncertainty, they should not be in business.

yes, but they can only trade for them what they have. people will always demand more of both, whether the food becomes tastier, or healthier, or more, or served on fancier platters, and whether the water is stream, or tap, or bottle, or delivered to them by a topless amazon goddess. DEMAND in the theoretical is infinite. However, Demand as it is expressed in the economy is only a function of what supply we have to trade to meet our Demand.

Then you dont know what demand is. In economics, it is possible to have a demand for things that don't exist. There is a demand for a cure (and treatments) for AIDS. That's why Big Pharma is investing so much money in finding a cure or treatments for it. And since people have money to pay for these cures and treatments, it is appropriate to call this "demand" in the economic sense of the word