More Jobs...

Seems like a great deal of what I hear regarding "Jobs" is to give tax cuts to small business will create jobs.

Now, in and of itself I have no issue with giving small business tax cuts. Where I have an issue is how this will "Create jobs".

First, let's back up a bit and ask... why is unemployment so high in the first place? The obvious answer is because people are out of work, and then the question is why they are out of work. I am sure there are many answers to that question but I would suggest that one of the reasons and perhaps the most significant is that THEY WERE LAID OFF.

Now let's ask... WHY WERE THEY LAID OFF? Again, many answers, however if we think in terms of one of the purpose of business, which is to SUPPLY a CUSTOMER, and it takes human resource to SUPPLY a CUSTOMER, then is it reasonable to think that a business needs a certain amount of employees to adequately supply the need of customers. If you say yes, then would it also be reasonable to think that if a business loses customers, and or the amount of business that it provides to the customer, then that business no longer needs - nor can afford - to maintain the same level of employment. So what does the business do? It LAY'S OFF THE EMPLOYEE. (Obviously if this trend continues then Mr. Business person then eventually goes out of business, and liquidates all his Capital). So the real reason for the layoff was then due to LOST BUSINESS.

As a side note, it is ironic that as a business grows, both Capital (equipment) and employee base grow with it. However when business declines, the irony is that it is much easier to "lay off" the employee, as it is to "lay off" the equipment, particularly if there are outstanding loans on the equipment.

So, along comes "BIG" as in Big Government, and tells Mr. Business owner. I am going to give you tax breaks, which Mr. Business owner translates as increased revenue. Great for Mr. Business person, but how does that get the jobs back?

OK, so now Mr. Business owner has more revenue. Should he go out and purchase more equipment or hire more people which presumably he really does not need (why did he lay them off in the first place?).  Sure, maybe he can hire more people, now that he has the extra money, but without regaining the LOST BUSINESS, then all that is accomplished is to REDUCE PRODUCTIVITY. Now isn't that a great way to run a business... "Hey folks, we have a great idea, we can now hire back the folks we laid off, but we really have nothing for them to do, so we will just increase the "break time" for all our employees". Brilliant!

What I am driving at here is that it  was the "LOST BUSINESS" that was the cause of the layoff, so would it not stand to reason that that the company must "FIND" more business in order to hire back more employees? So explain to me how giving more money to the business, in the form of tax breaks is going to "find" more business for the company?

In other words, Mr. Business owner does not necessarily need more money to hire back his lost help, he need MORE SALES. It is MORE SALES that will allow him to hire back the help. So if BIG can help out there then great, but giving the Money to Mr. Business person without increased sales... well that will be great for Mr. Business owner. Now he will be able to take that three week vacation to Aruba (at taxpayer expense) that he has been putting off.

Now, besides all that does anyone really think that even if BIG gives the tax break to Mr. Business that there will be enough "break" to hire employees. Think about it. Just one employee at $20.00 hour is $41,600.00/year, not counting benefits. Also a good deal of small business tax comes from "PROFIT". In the business I was in, there was hardly enough profit to keep for myself, let alone an amount adequate to hire more employees. BIG could have given me a 100% tax break and there still would not have been enough to hire back, however I could certainly hire more employees with increased sales, but not with profit.

Business's are in business to supply customers. It is that simple.

No customers = No business.

So to me this "give a tax break to small business" is just a political "feel good".

If BIG wants to do anything then...

 "STOP THE BLEEDING".

 Maybe start in China.

Just Say'n