First off the bad news. Milwaukee’s own Harley-Davidson is cutting over 1,000 jobs. No word yet on who will be cut or from where. The economic downturn affecting the entire Country needs immediate action, not just to save the fat cats or the investment firms on Wall Street, but to stimulate the entire economy through a “rising tide that will raise all boats”.
Getting people out of the unemployment line and back to the assembly line is what is going to get us out of this mess and get those motorcycles moving again.
So there’s a pragmatic and serious view of what needs to be done to create jobs, and then there’s Milwaukee County Executive Scott Walker who see’s an opportunity to push out a press release and hit the conservative talk radio shows to make sure everyone knows he has a plan to create jobs in Milwaukee and get the economy back on track!
Tax cuts.
Yes, tax cuts are what could get those 1,100 folks back to work according to Walker.
If his ‘solution’ sounds familiar, well, that’s because you’ve heard it before from County Exec. Walker. He has a simplistic solution to every problem this City, County, State and Country face or will ever face. Tax cuts!
Stock market tumbling? Tax cuts! Economy in the tank? Tax cuts! People losing jobs? Tax cuts! Bridges falling apart? Tax cuts!
I’d make a reference here to nails and hammers, but I think you get the point. No matter what the problem may be, our County Executive sees a tax cut as the solution.
While his remedy is entirely predictable, it’s not completely practical.
After all, didn’t we have a massive handout of cash just last spring? Those $600 or $1200 checks to every tax payer didn’t seem to help out the economy much then, so why would cutting the payroll tax, which is one of Scott Walkers proposals, fare any better? If a huge infusion of cash didn’t help, why would a few dollars a month make a difference?
Not to mention that payroll or FICA taxes pay for critical services like MEDICARE and social security, two programs which are more critical than ever in these hard times. Unemployment taxes are also part of those nasty payroll taxes Walker is advocating cutting or removing as part of his “tax cut” solution.
How many people would argue that now is the time to cut unemployment benefits? Apparently, Scott Walker. I wonder how those 1,100 people who are now forced to draw the unemployment checks they paid for through payroll taxes would respond to a plan to cut those benefits they’re now reliant on until they can find another job?
While Walker may envision his “one solution for every problem” approach to fixing the problems facing America and Milwaukee today as a positive for his run at Governor this year, the fact is that the solutions required are more complex than a simplistic campaign slogan like “tax cuts!“.
The unfortunate news from Vliet Street, just blocks from my house, today only reinforces that point.
I live in the Washington Heights neighborhood of Milwaukee, WI with my wife Jen, our daughter Emerson, and son Carter.
As I keep asking, what good does an income tax do for a person who doesn’t even have an income to tax?
They are actually moving the jobs to a county that doesnt have 9 mandatory sick days…coincidence?
The county doesn’t have that policy. Neither does the city for that matter.
And the HD site being closed is in Franklin.
You point is pointless.
Doh!
Mike Rosen recently ran research that showed or every dollar of tax cut only generates roughly 40 cents into the economy. The above illustrates why. Cutting taxes means cutting programs means cutting jobs means cutting the number of consumers.
Spending on infrastructure leads to about $1.40 of economic impact, because it radiates jobs. Which is the smarter policy?
Tax cuts as as economic stimulus strategy is just another way for people woo whine “my money is mine, mine, mine, mine.”
Like Barack said on Tuesday, “it’s time to put away childish things.”
Keith,
Not sure if or where Mike Rosen said this, and I’m curious as to why you’d be quoting Rosen, but here is a link that comes directly from Mike Rosen, contradicting the assertion that cutting taxes is not a good thing. http://www.rockymountainnews.com/news/2008/nov/28/rosen-the-trickle-down-myth/
Spending money on infrastructure, when needed is important, but it is not a way to spur economic growth. It IS a way to shuffle money around and create some jobs, but overall it’s a band aid to real growth and real progress. To state “Tax cuts as economic stimulus strategy is just another way for people woo whine “my money is mine, mine, mine, mine.” is curious considering the money that is being taxed is in fact MINE. That is not childish, that is just the plain truth. The people that support tax cuts and question government spending are not petulant children crying “This is my ball and I’m going home.”. They are hard working, families that are being asked (both in good economic times and bad) to “be more patriotic”, or give more to the government (like they’ll know what to do with it).
Barak was right; we should put childish things away. We can start with the ideology that increasing taxes and/or repealing tax incentives already in place, is the proper way to grow our economy.
Keith,
Not everyone believes that government spending has a return of $1.40 for every $1.00 spent.
Robert J. Barro, professor of economics at Harvard, has conducted research that finds that government spending, at best, has a return of $0.80 for every tax $1.00 spent
(as during WWII) and, in some instances (especially during peacetime), the return is “insignificantly different from zero.”
…and it’s inflationary.
Sean,
I understand the point you are trying to make, but how does a tax cut help someone that doesn’t have a job?
We have seen over the past eight years that tax cuts don’t create jobs, the only widen the gap between the haves and have nots.
Medicare and SS are already underfunded by trillions. Who cares if we cut their funding more? No one seemed concerned before when we were going to have to inflate and borrow in order to fund future liabilities; why does anyone care now when we’ll just inflate more and borrow more?
Don’t you think it’s a problem when these government jobs that are being magically created by the government to do work that we didn’t decide we needed to do until we were in trouble cost 4x the average private sector job? Even if it was only 2x the average private sector job, I’d be asking whether that’s the best way to “stimulate the economy”.
The problem with a government spending plan vs a tax cut plan is that the government spending plan is going to end up choosing winners and losers. Construction will win and grow, because it’s the target of the government spending. The rest of the economy, who are not the target of government spending, may or may not get an increase in revenue second-hand. What happens when the government faucet is turned off and all those extra construction workers and oversized construction companies no longer have any work to do?
The reason these evil Republicans push tax cuts (and if you pay any attention you’ll notice that there are plenty on the left who are pushing them too, including Obama), is because it is government money distributed evenly across the economy. No one wants the government to do something that is going to create distortions in the market and make things worse in the long run.
The payroll tax cut idea isn’t that crazy. It directly makes it cheaper to hire people without the need to lower wages. My company is going through a second big round of layoffs right now, and without a doubt they would be able to layoff fewer people if the cost per employee were reduced by reducing payroll taxes. In contrast, I don’t think they’ll change their layoff plans based on the shiny new roads our town will be getting.