Gohmert's "jobs" bill: 0% corporate tax

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    Sep 15, 2011 12:07 PM GMT
    OK, since people complained it's too quiet in here, let's fight over some inane piece of political news.

    http://thinkprogress.org/economy/2011/09/14/319564/gohmert-corporate-taxes/Taking the GOP’s anti-tax ideology to its logical conclusion, Rep. Louie Gohmert (R-TX) introduced today his own “American Jobs Act” — giving his bill the same name as President Obama’s plan — which would completely eliminate corporate income taxes. Gohmert claims this will create jobs:

    It is a very simple bill, which will eliminate the corporate tax which serves as a tariff that our American companies pay on goods they produce here in America. This bill will actually create jobs in America

    The two-page bill changes the tax code to replace any mention of the current “35 percent” tax rate with “0 percent.” Corporations are already sitting on trillions in cash, so cutting their taxes would likely do very little to help the economy, but would balloon the deficit by depriving the government of about $300 billions in revenues annually. As the CBO found, cutting taxes on businesses “typically does not create an incentive for them to spend more on labor or to produce more, because production depends on the ability to sell output.”


    What's going to stop everybody from incorporating themselves if such political shenanigans are ever passed as law?
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    Sep 15, 2011 2:22 PM GMT


    "...because production depends on the ability to sell output.”

    BINGO. No company, no matter how rich, is going to hire and pay people just to sit around doing nothing.

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    Sep 15, 2011 2:32 PM GMT
    meninlove said

    "...because production depends on the ability to sell output.”

    BINGO. No company, no matter how rich, is going to hire and pay people just to sit around doing nothing.



    Except that need comes before a sale. Demand isn't just magical fountain of pixie dust.
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    Sep 15, 2011 2:46 PM GMT
    riddler78 said
    meninlove said

    "...because production depends on the ability to sell output.”

    BINGO. No company, no matter how rich, is going to hire and pay people just to sit around doing nothing.



    Except that need comes before a sale. Demand isn't just magical fountain of pixie dust.



    lol, wut? How about staying on topic. But...just for you...


    A business can only address a need if the needer has money to spend on his need. A business is not going to hire a bunch of people to sit on their butts while waiting for non-existent consumers. Consumers push demand; business responds by hiring to address the work-load caused by said demand.

    Good grief.

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    Sep 15, 2011 3:09 PM GMT
    meninlove said
    riddler78 said
    meninlove said

    "...because production depends on the ability to sell output.”

    BINGO. No company, no matter how rich, is going to hire and pay people just to sit around doing nothing.



    Except that need comes before a sale. Demand isn't just magical fountain of pixie dust.



    lol, wut? How about staying on topic. But...just for you...


    A business can only address a need if the needer has money to spend on his need. A business is not going to hire a bunch of people to sit on their butts while waiting for non-existent consumers. Consumers push demand; business responds by hiring to address the work-load caused by said demand.

    Good grief.



    You keep on talking about demand as if it's this magical oasis that government has control over or can artificially pump. It can't. Governments don't create sustainable demand. That can only come from greater business and consumer confidence. A need really isn't a need unless someone is willing to pay for it - and there's plenty of money out there to spend. There are a number of businesses I know are growing - but there are a lot more that don't want to invest because they're worried about impending higher taxes and to varying degrees increased regulation.

    Hiring follows productivity growth and profitability. When governments attack either, because markets are forward looking, the former stops - or in the very least, slows down.
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    Sep 15, 2011 3:24 PM GMT


    "You keep on talking about demand as if it's this magical oasis that government has control over or can artificially pump."


    lol, weirder and weirder, just where have I said, so far on this topic, anything about government creating demand?

    O.o
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    Sep 15, 2011 3:27 PM GMT
    meninlove said

    "You keep on talking about demand as if it's this magical oasis that government has control over or can artificially pump."


    lol, weirder and weirder, just where have I said, so far on this topic, anything about government creating demand?

    O.o


    Demand is an effect, not a cause of why fewer jobs have been created. Not on this thread but on others.
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    Sep 15, 2011 3:32 PM GMT
    Sorry Riddler, many business owners we know disagree with you.

    Put ludicrously simply, a fish and chip place is not going to hire more staff unless there's a line-up of customers greater than their ability to serve them.

    kiss
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    Sep 15, 2011 3:51 PM GMT
    meninlove said Sorry Riddler, many business owners we know disagree with you.

    Put ludicrously simply, a fish and chip place is not going to hire more staff unless there's a line-up of customers greater than their ability to serve them.

    kiss


    That's only because you haven't asked them "why". In your example, a fall in demand for a fish and chips vendor might come from anything from employment falling in the area, to the fact another better place opened up right next door. Demand is a symptom or an effect - not a cause.
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    Sep 15, 2011 3:54 PM GMT
    Um....we're talking about why a business would hire more staff, and it's not by solely reducing taxes on them. If there's no demand they pocket the extra money and make their shareholders or the business owner, happy.

    Stay on topic and we'll respond, otherwise, have a nice day!



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    Sep 15, 2011 3:58 PM GMT

    jp, it's called arguing for the sake of arguing. He is creative about it, I'll give him that.
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    Sep 15, 2011 4:01 PM GMT
    meninlove said Um....we're talking about why a business would hire more staff, and it's not by solely reducing taxes on them. If there's no demand they pocket the extra money and make their shareholders or the business owner, happy.

    Stay on topic and we'll respond, otherwise, have a nice day!


    Lol - just because you want to be the arbiter of what's on topic or off - especially when you don't seem to understand the basic issues, does not make it so. We are talking about why business would hire more staff.

    Your claim is that it's because of demand - and you accuse me of straying off topic? Lol. I have not made any claims that reducing corporate taxes to zero would result in more jobs here - but I would point out that again, jobs follow profits and productivity. So if companies are making more money on their investments and expect this to continue, they will invest more in people and in productivity. I would also point out that money that is saved - so long as it isn't in a mattress somewhere gets reinvested in the economy.

    Part of the problem is that we spend too much - and we spent too much and the economy is correcting themselves in part - but the interference by governments that make it more difficult to make the transition or for bad companies to fail just prolong the process/inevitable.
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    Sep 15, 2011 4:09 PM GMT
    "We are talking about why business would hire more staff."


    Yes, we are, and we specifically commented on the article where it said, "As the CBO found, cutting taxes on businesses “typically does not create an incentive for them to spend more on labor or to produce more, because production depends on the ability to sell output.”

    You however are trying to move this topic somewhere else. Knock yourself out.

    Buh-byeee...
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    Sep 15, 2011 4:11 PM GMT
    meninlove said "We are talking about why business would hire more staff."


    Yes, we are, and we specifically commented on the article where it said, "As the CBO found, cutting taxes on businesses “typically does not create an incentive for them to spend more on labor or to produce more, because production depends on the ability to sell output.”

    You however are trying to move this topic somewhere else. Knock yourself out.

    Buh-byeee...


    And as I pointed out to you - demand does not flow from a mountain of pixie dust. Demand is a symptom, an effect not a cause. Have a nice day icon_wink.gif
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    Sep 15, 2011 11:20 PM GMT
    riddler78 said
    Hiring follows productivity growth and profitability.


    mfg2.jpg
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    Do I need to post a graph for the jobs?icon_lol.gif

    http://www.msnbc.msn.com/id/43860044/ns/business-stocks_and_economy/#.TnKIk9T6e9U
    A boom in corporate profits, a bust in jobs, wages
    'I've never seen labor markets this weak in 35 years of research'