Wednesday, October 5, 2011

Building a Screened Porch on a Submarine

I was once accused of blaming the entire state of the economy on Barack Hussein Obama. I don't. The problems we are facing have been in the making for years and Administrations both with R's and D's after their name are responsible. It's like this, when Barack Hussein Obama walked into the lower deck of the submarine that is called the US Economy, he saw the sizable gash in the wall flooding the inside with water. In a move of sheer genius, he decided to enlarge the hole to five times larger and build a screened in porch.

His stimulus plan failed as anyone with half a brain knew it would. His latest endeavor at expanding the hole for his new porch is the Jobs Bill. His speech betrayed his obvious ignorance at how the capitalist American system works. He mentioned hiring more teachers, more cops, more government workers. Don't get me wrong, I like teachers and cops. Someone has to explain to him though how teachers and cops get paid. Both are government workers that get paid from the taxes contributed by the business owners and "rich" people he wants to take money from.

Government employees are paid, in accounting lingo, with short term and long term liabilities. Government jobs do not create new products that people shell out money for. They do not grow an economy because all the funds that go toward paying them are based on revenues. These revenues are based on the taxes paid in the state. If private industry employers are not expanding because of a slow-down in the economy, their revenues decrease. If private industry revenues decrease, so too do the taxes they pay.

To increase the taxes these business owners pay means further cuts in expansion and hiring. Further cuts in expansion and hiring in the private sector means fewer people working and paying taxes themselves. Reduced tax revenues means less money to pay the government workers that are already employed, much less make an attempt to hire more. One example:

Democrats touted the opening of a prison in one local area as being a jobs bonanza. It meant an additional 150 jobs. The prison opened and began operation in a financially depressed area. 150 people now had jobs in this area. But these were all nominal wage jobs. The tax revenue requirements to keep the prison open, pay employees, feed inmates and more soon overwhelmed the local economy and led to more financial disaster.

In contrast, a new manufacturing company, having hired 150 employees, would sell products. Ideally in more areas than just their town, but nonetheless, people would spend money buying product. The revenues earned would be from the free market paying for these wonderful widgets. The companies in nearby areas that do business with the manufacturer would be making money by providing parts, services and more to this company. Instead of just 150 people being employed, it would mean more hiring for other jobs in other companies to help work with this manufacturer.

Each of these new employees would be paying sales, state and federal taxes. They would be buying items like cars, clothing, lunches and more as their work now allows them to spend instead of to scrimp. Other businesses would be stimulated. This cannot be done with government jobs, and most assuredly cannot be done during a period of economic downturn. Obama is just an ignorant, arrogant windbag. Please turn me in to Attack Watch before I am allowed to get away with this horrible thing called free speech.

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