Wednesday, January 6, 2010

The Government Does Not “Create” Jobs

The government can employ people. It can thus achieve full employment by drafting every unemployed person to work in a government job. Particularly, high-cost, make-work jobs. Federal “stimulus” spending is promoted for its job creation. But such spending does not “create” jobs.

Private industry jobs are created in response to economic demand, incurred in response to a need. A businessman knows that expenses should be kept to a minimum, so jobs are genuine. Real job growth requires business optimism. Training along with payroll expenses make human resources a long-term investment.

Government work also absorbs tax money, that could have been used for economically useful job growth. The government uses tax dollars as “stimulus” funds only as it sees fit.

The government can help create jobs by cutting taxes. That would make it easier to create business. They can help also by limiting restrictions on terminating employees. The latter would therefore more easily get hired by private industry.

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