I will use this blog to do three things. One, provide a voice of opposition to the liberal controlled government. Two, to track their progress on promises they made to get elected (to see if they ever deliver.) Three, to vent, educate, and to work through my own frustration. Please read the ground rules if you wish to respond to this blog.

Saturday, November 8, 2008

Clueless Obamanomics

On the Today Show Firiday one of Obama’s top economic aides was on showing his towering intellect. Wow, this is staggering, even now as I write it, I can’t believe that this is the guy who might be leading the charge for Obama’s economic plans.

Meredith had established that our country survives on consumers. Need to add a little bit more here. We only survive on consumers. We don’t make much anymore, if you don’t consume, (buy something today) your neighbor down the street loses his job. If he doesn’t consume, you lose your job. We have built the most fragile economy on the planet and it is showing its frailty.

Now, this brain trust that Obama has developed began to answer questions and what he said was once again the half truths of his campaign.

‘We need to stimulate the middle class so that they will spend. We need to either get a tax cut into their hands or a stimulus check to them so that they will stimulate the economy.’

Now, on the surface this sounds good right. Those of us in the middle class would like more money to spend, but, THAT ISN’T THE ISSUE AT ALL!

So let’s have a little economics lesson shall we?

The economy is mostly affected by jobs. Why? Because, jobs provide a constant flow of money for consumers. When people have a job, they spend their money. (People without a job spend other people’s money, it’s just a lot less) When people lose their jobs, mostly because other people are not spending their money, they stop consuming and other people lose their jobs. Cyclical.

So what’s wrong with a stimulus plan, nothing. But, I know something that is better. You see, a stimulus plan is a booster shot, a one hit wonder. It is not a gift that keeps on giving. If you want to stimulate the economy, create new jobs. Jobs don’t provide a one month $1,800 check to spend, it creates an ongoing consumer stream that saves your job, your neighbors job, and mine.

So obviously, a job is worth much more in the long run then a middle class tax cut or a stimulus check. Many times more.

So this aide to Obama says, ‘we need to create 100-200k jobs as quickly as we can.’
So let’s check the Obama plan for creating jobs. ‘We are going to tax people who make $250K+ and give tax relief to everyone else including $1,000 checks to people who don’t pay taxes.’

Need more information? Thought so. How many poor people are going to take their $1,000 check and hire someone? Right, none. How many people who make $70,000 a year working for UPS are going to create a job with their tax refund? Right again, none. How many people who have jobs working for someone else, are going to take their tax cut, start a business and hire five other people? In this climate? Right again, none.

It isn’t Reaganomics, it is simple economics. Poor people, people who work for other people, and people who don’t work, DO NOT CREAT JOBS!

Who does? Well therein lays the craftiest lie in all of this. The average successful small business owner in this country makes just about $250,000 a year. They supply the greatest number of jobs nationwide. They get paid to take the chance, build a business and they have earned their reward. These are the people Obama’s brain trust wants to tax. Brilliant. That’s the way to get them to invest more, and hire more people, by punishing them with more taxes.

I am a small business owner. I have a desk, a phone, and work for another employee. I know if I hire that employee, I could make more money. I could grow my business. But that desk has gone unoccupied for the last three months and I have no intention of filling it anytime soon. Why? Because if you (my dear reader) lose your job because your neighbor stopped consuming, you won’t buy my products and then I lose the income from that sale. This hurts my business. So instead, I will sit on the capital that I so wisely saved during the economic boom, and wait this economic crisis out. (I can do that because I saved a lot more than I consumed during the last five years personally too.)

Obama’s plan to tax the rich and give to the poor sounds great as a stump speech, It placated the masses, and trumped the promises of economic security for all. But, I will bet you a whole bunch of my money that when push comes to shove, people would rather have a job then a stimulus check. They would rather have a job then a tax cut.

So as you contemplate your hope filled Obama future, think about this. That person I didn’t hire, because I am unsure about Obama’s taxes, didn’t get a paycheck from me this week, so he/she didn’t consume, so your neighbor is about to lose his job, which means, yep, you guessed it, you’re about to lose yours.(Now, don’t even think about blaming me for not hiring that person. I do what’s best for me and my family just as you do yours. Blame Obama if you must, I invoke the Clinton Rule)


Loreen Bliss said...

Tim owns a business too and through all the election he kept saying exactly what you have. And, he couldn't understand why people couldn't understand the problems with Obama's tax plan!!! He is a bit worried too. Tim took economic courses for his major, but evidently everyone's course on Obamanomics, or however you say it (lol), is the only course some people have ever taken. It's amazing how little some people understand about all of it! Tim's brother wanted to expand his business, but, like you, has chosen not to because of all the uncertainties ahead and so he wouldn't fall into the higher tax brackets.... by the way.... do you happen to know what exactly is is now (at the moment)? It started at $250, then we heard $200, and even some say it has dropped to $150! It's crazy!

Kara said...

hello...are you not on vacation!!!

Josh Ray said...

I'm also a small business owner and I fired my last employee about 8 months ago because I was unsure about the economy, and with the prospect of higher taxes I didn't want to risk it. You are absolutely right on this. $1,000 a year is not going to make a huge difference in most peoples lives, and when those same blue collar workers lose their jobs due to Obama's new taxes, $1,000 won't mean anything.

It seems so clear and easy to understand. I wonder if America is really this dumb, or is America just looking for a handout and not caring about the long term implications?