Categories: Common Wealth

Hundreds of Millions of Consumers Create Jobs – Not Millions in Tax Breaks for the Mega and Ultra Rich

Conservatives without conscience (CWC) are imagining that the mega and ultra rich will create jobs if they are certain they can keep their excessive tax breaks. The only thing certain about job creation is – it’s not happening.

First of all, the few hundred billionaires in this segment of the population have had these tax breaks during the entire Great Recession and have had no impact on the nations unemployment. Even under G. W. Bush’s presidency, while these tax breaks were in place, only “375,000 jobs a year [were created], the most pitiful record since 1939 when the Bureau of Labor Statistics started collecting the numbers.”

The mega and ultra rich keep their money for themselves and their indulgences. They don’t care about creating jobs. They care about increasing their wealth.

Secondly, the work, which makes them rich, cannot produce the number of jobs the country needs. Billionaire hedge fund managers are mostly making deals with millionaires or asset managers who have access to millions. The deals these billionaires are making are ones most of us cannot afford and it takes only a few employees to make these large and relatively small number of deals. Millionaire celebrities in sports, media and entertainment employ very few people to justify their lopsided tax breaks. Corporate executives are finding that they don’t need to rehire employees – they are able to meet current demand without hiring while at the same time increasing their profits to record levels.

Most of these mega and ultra rich CWCs are all about ME, ME, and ME. Only a few like Warren Buffet and William H. Gates Sr. are concerned about WE and creating jobs.

Maintaining unreasonable tax breaks for the mega and ultra rich cannot, and has not, created the demand needed to replace the number of jobs lost by the Great Recession, which the selfish CWCs helped propogate while trying to get richer.

Here’s what does create jobs – the certainty of consumers purchasing goods and services. The economy is driven by hundreds of millions of consumers – not the richest 2 percent of them. The bottom 98 percent grows the economy and jobs by demanding goods and services. As these vast numbers of consumers demand more, businesses create jobs to make, sell, and service all the goods and services being purchased.

So, where is this demand going to come from if businesses are not hiring and unemployment is being dropped? The only place it can come from is the federal government. We need more federal stimulus to create new jobs which will increase consumer demand and cause American businesses to start hiring again.

To pay for this stimulus, the government needs to cancel the excessive tax breaks for the mega and ultra rich and return the corporate tax rates to where they were decades ago.

One last point: Why has unemployment gone up? Was it because 2.6 million mega and ultra rich had to pay more in taxes or because 260 million middle and low income consumers stopped buying?

Andy Hailey

Vietnam Vet, UT El Paso Grad, Retired Aerospace Engineer, former union rep, 60's Republican now progressive, web admin, blogger.

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  • The other part of this equation is those marginal corporate tax rates. They're taxes on profits. When businesses pay higher percentages of taxes on their profits, they'd rather spend their money on labor, equipment, training, etc. instead of simply handing the money over to the government. What we could learn from this period in our history is that high taxes don't kill business like we've been lead to believe. High taxes actually help business by creating jobs and thus, consumers.

    Without the incentive to spend money on labor, it's clear that business won't do it. If they're allowed to sit on their profits, they will. They'll sit on their profits and demand more tax cuts (a powerful drug) and squawk about "uncertainty" without acknowledging that their behavior has anything to do with the lack of business for their business.

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