Posted on 01/31/2006 6:13:23 PM PST by liberallarry
Sluggish private job growth indicates failure of tax cuts
Changes in tax law since 2001 reduced federal government revenue by $870 billion through September 2005. Supporters of these tax cuts have touted them as great contributors to growth in jobs and pay. But, in reality, private-sector job growth since 2001 has been disappointing, and a closer look at the new jobs created shows that federal spendingnot tax cutsare responsible for the jobs created in the past five years.
If tax cuts have created jobs at all since 2001, it will have happened in the private sector. Assuming that job growth in 2006 matches the Bush Administration's projections, the economy will have added about 2.0 million jobs to the private sector from FY2001 through FY2006. But how many of these two million jobs actually can be attributed to tax cuts and how many to increased government spendingparticularly increased defense spendingin this period?
Based on Defense Department estimates of the number of private-sector jobs created by its own spending, we project that additional defense spending will account for a 1.495 million gain in private sector jobs between FY2001 and FY2006. Furthermore, increases in non-defense discretionary
spending since 2001 will have added yet another 1.325 million jobs in the private sector, for a total of 2.82 million jobs created by increased government spending. Increased mandatory government spendingwhich is not even included in these estimates or the accompanying chartwould account for even more job creation. The mere fact that the projected job growth resulting from increased defense and other government spending exceeds the actual number of jobs projected to be added to the economy through 2006 clearly indicates that the tax cuts hardly seem plausible as the engine of the modest job growth in the economy since 2001.
Exactly! I'm amazed at the ingnorance of these so-called economists who ignore just how many crises this country has indured in the last 5 years...yet continues to roll. Heck, from the corporate scandals and bankruptcies to 9/11 and the WOT to the natural disasters and oil prices...if it wasn't for these tax-cuts we would've been buried long ago. Try again, Larry.
These clowns would have us believe that companies that profit from defense spending are not part of the private sector.
Same old pack of lies.
The phone's been ringing nonstop.
If this is "sluggish", I wouldn't survive "heated".
Not all of us have economics degrees. Understanding agendas helps understand subsequent spin.
Very good people and low-wage, hard-workers are in demand (probably always). What about the others?
What economist doesn't believe tax cuts stimulate the economy? That's one of the basic tenets of economics.
Are these people serious?
That can happen...but more often it's just a way of rejecting a position without understanding it.
what plamet is this guy talking about?
That's right. But I didn't know it failed. I thought it had just been abused. What was supposed to be an emergency, counter-cyclical policy was turned by Left-wing liberals into a permanent redistribution scheme.
If you believe their figures and definitions, that is.
I'm inclined to believe this bunch has cooked the books to produce figures which support their hypothesis. The sources and bases for their data -- and how that same data would look on a skewed timescale -- would be illuminating.
You know what they say about "statistics". This case is probably an object demonstration of the point.
*Jobs for the rest of FY2006 based on the 12-month growth rate from December 2004 to December 2005
Source: Author's analysis of CRS, Defense Department, and OMB data.
What sophistry. He's basing his ersatz "analysis" on Dec'04 to Dec'05, when a significant chunk of coastline was annihilated by a hurricane. What drivel. Also, what exactly does FY2006 mean? Fiscal Year, but for whom? When does it start and end?
You don't have a growing economy for ages without job production. Period.
Unless, of course, productivity begins to outpace/hold even with economic expansion. And we've been seeing amazing gains in productivity for some time now. So no, I'm going to disagree with you. Job growth has been the result of tax cuts. The results have just been dampened a bit by the productivity gains.
Unemployment is too low right now to have high sky-high job growth anyway. Unemployment doesn't go down to 0% when there is a good economy; 95% is usually considered "full employment".
The authors have engaged in a little bait and switch here. First they analyze job performance over the term of Bush's presidency (a perfectly valid topic), but then in their conclusion they switch over and try to pretend that they're analyzing the results of Bush's tax cut. If you want to see how the tax cuts have affected the economy, you have to look at the period in which the tax cuts were in effect: that's 2003-2006, NOT 2001-2006. Since the authors are using net job gains, the 2001-2002 period of massive job loss contributes to their predetermined conclusion by allowing them to deflate the actual gains made after the cuts.
If by "the others" you mean the polar opposites of those you named, I can't imagine who would want them as employees. What is one to do with sub-standard, underperforming employees? How do they help a company to achieve its goals and reap profits?
Of course I don't mean that.
I mean those who are not brilliant but who expect good wages for their labor. Those who are being gradually forced out by cheap labor from Third-World countries. Most of America's workers.
But I'm sure that's all a coincidence...
"That's right. But I didn't know it failed."
Keynesian economics is a failed economic theory. Its principles are based on poor logic and wrong assumptions. It went bye bye with Jimmy Carter.
Check your own facts first, liberal. "Mostly" to wealthy individuals is a simple result of the fact that "wealthy" individuals pay the "most" tax! I'm not rich, but I benefited from the tax cuts -- in exact proportion to how much tax I paid! Simple math refutes your silly assertion.
Typical crap from the same old crowd....
Still being taught at a university near you.
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