My analogy was meant to point out the there is no such thing as “excess” profit that automatically turns into investment in labor and production. For that to occur, the profits have to be anticpatible and unfettered.
When you don’t know what inflation, taxes, healthcare and other benefit costs will be, you don’t hire on hope. When you don’t know if the government is going to play favorites in your industry next week, you can’t plan for growth, you pocket your profits and evaluate your upcomming opportunities.
I sold a lot of apples last week. If that happens for 12 weeks in a row, I may begin to expand, but there has to be some consistancy.
The article was proposing a direct, virtually cause-and-effect, relationship between net earnings and hiring. Hiring is related more to production and markets than to earnings.
That being said, the Marxist would say, well if there is no relationship why can’t the public steal the profits and use them for the “greater good?” The answer is that government is a poor source of jobs and if quick reacting business has its profits stolen preventing retained earnings and investment capital then the general business economy cannot respond to opportunity when it arises and does no hiring for such.