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Re: Dem Illinois economically outpaces Walker's Wisconsin

By: Cactus Flower in ALEA | Recommend this post (0)
Tue, 24 Apr 12 5:26 PM | 63 view(s)
Boardmark this board | The Trust Matrix 		Msg. 07439 of 54959
(This msg. is a reply to 07437 by clo)
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Hi clo,

Wholly appropriate. Of course cutting taxes does not directly create jobs! The theory is that putting money in people's pockets will stimulate entrepreneurialism, but this is at best an indirect response.

This may be true sometimes, but it depends upon the economic environment.

In the recent environment, the problem has not been that there was no cash to invest. Most large companies have had plenty of cash, for instance. It is that sitting on cash is appealing when interest rates are very low or even negative. Whereas hiring people and starting a business is always risky.

The Republicans for some reason decided that cutting taxes will always yield jobs. Far as I know, this is nonsense from an economic perspective. But they have done so anyway, which is why people think there's a second reason for their actions, which is to reward the wealthy who also happen to be their supporters. At any rate, where they can cut taxes and fire government employees, they have. With the result that Republican states are typically worse off in terms of unemployment.

So the Republican idea that cutting taxes always yields jobs is found wanting.

At times like those we have seen recently, government is usually the entity which is most capable of creating jobs. They can undertake the sort of projects that return a long run value, such as building power stations, new train networks and things like this. So you pay for the project now (debt and interest) and they yield a return over the long run (asset and income) - they plan that the project will break even or make a profit by the time the project winds up. A good example is the Hoover dam. The other good thing is that people with an income consume products and services and they don't add unemployment expense to the economy.

As a recovery takes hold, the private sector will tend to do the heavy lifting. So if this recovery has legs, we should see everyone doing better, jobswise. But if the recovery stalls, then the only hope for new jobs is from the government. Otherwise, we're going to see an excruciating period of high unemployment.


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The above is a reply to the following message:
Dem Illinois economically outpaces Walker's Wisconsin
By: clo in ALEA
Tue, 24 Apr 12 1:05 PM 		Msg. 07437 of 54959

Good morning Cactus Flower,

When I learned about this I wanted to share it here. If you think its not appropiate delete it.
It shows how cutting taxes does NOT create 'jobs', just the opposite.

This is the main reason I want Walker walking...
Lets hope the recall works so Wisconsin can get back to work!

Monday, April 23, 2012
Dem Illinois economically outpaces Walker's Wisconsin

As I've noted before, Republicans had a great deal of fun back in early 2011 taunting Illinois for (surprisingly) electing a Democratic governor, Pat Quinn. The theory was that Quinn's tax increases, designed to close a huge budget gap, would lead to a business exodus to Gov. Scott Walker's Wisconsin conservative utopia.

"Years ago Wisconsin had a tourism advertising campaign targeted to Illinois with the motto, `Escape to Wisconsin,'" Wisconsin Gov. Scott Walker said in a statement. "Today we renew that call to Illinois businesses, `Escape to Wisconsin.' You are welcome here."

In reality, turns out that Wisconsin was the only state in the entire country to lose jobs in 2011, while Illinois had better than average growth. The Federal Reserve Bank of Philadelphia also predicted strong economic growth in Illinois, while placing Wisconsin last in its forecast.

Now, an economic analysis by Bloomberg finds that Wisconsin is getting its ass kicked by Illinois.

Illinois ranked third while Wisconsin placed 42nd in the most recent Bloomberg Economic Evaluation of States index, which includes personal income, tax revenue and employment. 
Illinois gained 32,000 jobs in the 12 months ending in February, the U.S. Bureau of Labor Statistics found. Wisconsin, where Walker promised to create 250,000 jobs with the help of business-tax breaks, lost 16,900. It's conservative mantra that tax increases kill jobs, but reality, as always, contradicts their ideology. 

http://www.drudge.com/news/156029/dem-illinois-economically-outpaces-walkers

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