The best way to grow jobs is to dismantle government as we know it.
To hear the Republican primary candidates tell it, all will be well if we just gut government regulations. All of ‘em. Miraculously, the jobs will start to flow like honey in the land of milk and sophistry. What I want to know is where do they get this crap and why doesn’t anyone call them on it?
Here’s three recent sound bites reported by NPR in an Associated Press story entitled “FACT CHECK: Regulations Not A Huge Jobs Killer.”
- MITT ROMNEY: "All of the Obama regulations, we say no. It costs jobs."
- RICK PERRY: Regulations "are strangling the American entrepreneurship out there."
- RICK SANTORUM: "Repeal every regulation the Obama administration put in place."
Meanwhile, the story goes on to say, “Labor Department data show that only a tiny percentage of companies that experience large layoffs cite government regulation as the reason.” The number of jobs lost due to government regulation is “two-tenths of 1 percent.”
A small business survey released by PNC Financial Services Group on October 7 found that four out of five small businesses have no plans to hire in the next six months due to—listen closely presidential wannabes—weak sales. What’s more, some of them are contemplating more layoffs.
Yup, lack of demand is the driver, or anti-driver here. Government regulation is just flat wrong. Ask Scott Holstein, of Kim and Scott’s Gourmet Pretzels in Chicago:
Demand really drives the hiring. So if we're just gonna get a discount in, say, employment taxes, that's not necessarily an incentive. I mean, it's a little bit - it's nice, but it's not gonna make us hire somebody. What makes us hire somebody is demand, you know, is needing to make more product.
According to the PNC survey, just 18 percent of small businesses are optimistic about their business prospects over the next six months. Given that small business is the primary engine for new jobs in a recovering economy, it looks like we are in for another bout of too much of nothing. A stagnant jobs pond is virtually a given; and perhaps we’ll even see a double dip if these business owners do start to shed workers in a big way after the holidays.
The last thing we need right now is a bunch of economic amateurs harping about regulation. They are just carrying water for client companies like the major electrical power generators. These guys want to gut the Clean Air act so they can poison the air with more mercury from antiquated coal-fired plants even though reports out just this week link these power plants to dangerous levels of mercury in a variety of wildlife. Rick Perry and Mitt Romney should get their facts straight: that kind of deregulation leads to more cancer and premature deaths, not more jobs.
The coal and gas industries have their sights set on the Clean Water Act. Fracking and mountaintop removal means big, big money to these vested interests who would love to see a President Bachmann close the EPA.
Speaking of Michele, who would be a veritable environmental Sister Sludge if elected, after repealing “radical environmental laws,” she’d overturn the Affordable Care Act to solve our jobs problem. The only jobs that would lead to would be more ER nurses assigned to care for people showing up way too sick for their care of last resort.
The Republican call for deregulation as job growth strategy is only taken seriously by Cato Institute “economists,” to use the term loosely. Yet the major media dutifully reports debate remarks and daily sound bites with hardly a shred of context or analysis about what has become the major Republican answer to joblessness. No matter who gets the nod from the Republicans, we are going to have to listen to some kook explain how cutting Small Business Administration red tape or FDA food safety regulations related to cantaloupes is going to really get this economy humming.
Of course corporate tax holidays, or even permanent vacations, such as candidate Bachmann’s call for a corporate tax holiday on $1.2 trillion (that's with a tr-) in profits will emerge as a proposed solution from the right. But even if we went totally Greek on corporate profits and just stopped collecting taxes on them, it wouldn’t make a shred of difference on the number of workers they would hire, it would just increase their already grotesquely bloated cash reserves.
Hiring corresponds to demand. Period.
As Scott Holstein points out with more clarity than the entire Republican field put together, a discount in employment taxes is nice, a little something around the edges, but it will hardly drive hiring. As one who has advocated just that strategy here, I agree, it’s just a little something that might encourage someone who is on the fence about hiring to act a little quicker. It’s not going to reduce that gigantic lump in the snake, that 45 million person lump of unemployed people.
We owe it to ourselves and the nation to just stick our fingers in our ears and resort to blah blah blah every time we hear the R-word posed as the root of our evils and deregulation as the key to a hiring binge. When the Year in Stupid is written, its marquee headline will almost certainly includes the words Republican and Regulation pertaining to the profound dearth of comprehension on what regulation does and doesn’t do. Either that or a profound adherence to whoever is pulling their money-strings. And the minute a Republican candidate for president or dogcatcher comes up with a plan to stimulate consumer demand, I promise, I will be all ears.