710,000 Jobs Down the Drain
Jul 20, 2012 -
Last week, in what sounded like a classic campaign speech, President Obama announced his desire to raise taxes on American families, investment, and small businesses. This, of course, was not new; it was at least the 25th time he called for these tax hikes.
We also learned that the President hasn’t met one time in the last six months with his own Jobs Council, founded with the purpose of “developing realistic, achievable ideas that business and government can put into practice starting now.”
“Now” would be nice.
Instead of working to get America’s economy back on track, the President is stumping for taxes that would sideline economic productivity and throw around 700,000 jobs down the drain.
On Tuesday, Ernst & Young released a report studying the long term macroeconomic impact of the President’s plan. It’s clear from the report— the President’s plan is anything but fair to Wisconsinites suffering in this weak economy and an unreasonable approach to creating jobs.
If President Obama implemented his tax hike, the report predicts the country would lose 710,000 jobs and $200 billion in output. Workers’ living standards and wages would also decline.
The pain would hit us at home, too. Wisconsin would lose 14,900 jobs and $3.4 billion in output.
The report concludes:
“These results suggest real long-run economic consequences for allowing the top two ordinary tax rates and dividend and capital gains tax rates to rise in 2013. This policy path can be expected to reduce long-run output, investment and net worth. If the revenue is used to finance higher spending – a policy consistent with financing the growth in entitlement programs – employment and livings standards would also be adversely affected.”
The President’s tax hike would decrease our economy by 1.3 percent, and unemployment would increase by .5 percent. How is that fair to the 20 million already unemployed or underemployed Americans still looking for a job? It isn’t.
What also isn’t “fair” is the President’s repeated and misdirected attack on American families and small businesses during the slowest economic recovery our country has experienced since the Great Depression. And it isn’t “fair” for the President to say to small businesses owners who have poured their blood, sweat, and tears into starting their own business: "If you’ve got a business -- you didn’t build that. Somebody else made that happen."
Unemployment has now been higher than eight percent for more than 41 months. The Joint Committee on Taxation shows that the President’s tax hike would hit 53 percent of small business income. And that tax hike would hit at least 900,000 small businesses.
These are the same small businesses that drive our economy and employ 25 percent of the workforce. Putting the brakes on the engine of our economy will punish job seekers.
Perhaps if the President had met with his Jobs Council, he would have heard about the challenges facing businesses today.
Instead of making it more difficult to be successful, why doesn’t the President look for common-sense solutions to spur the economy and build confidence?
He can approve the Keystone Pipeline, which would create 20,000 jobs. He can stop the “Taxmageddon” scheduled to hit every American taxpayer and small business on January 1, when current tax rates expire. He can help attract companies to come to the U.S. to build, expand, and invest by working with Congress to lower our highest-in-the-world corporate tax rate. He can offer more offshore drilling leases to start developing our natural resources, rather than present a plan that would be the fewest lease sales ever offered.
Getting to work on these barriers to putting Americans back to work should be job number one, not more press conferences and campaign speeches to push higher taxes.