Monday, September 21, 2009

WSJ-The Case for an Employer Tax Break

If the problem is lack of jobs, why are we subsidizing everything but employment?
Bailouts=Wasted vast sums of money subsidizing failure so we can all continue to dig ourselves deeper into debt with cheap credit.
Stimilus=Favor factory, and even if you believe in dumping money in a hole, this is way too slow!
Seems like a more pure Keynesian move would have been to do direct and immediate stimuli such as:
  • Payroll tax holiday for 1 year
  • Employment tax credits (like in the article below)
These sorts of stimuli would have an immediate and direct impact on employment by making employment less expensive.
I think the answer is that these sorts of "universal" actions would not allow the politicians to hand out favors to special interest groups. I feel that the government should have done nothing (on deficit), but if you really believe in Keynes, this would seem to be the way to go. Instead, everything is being done to make employing people more expensive, from higher minimum wages, to big labor giveaways, to health insurance mandates.

http://online.wsj.com/article/SB10001424052970204518504574416992816628538.html?mod=djemEditorialPage

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