Did anyone notice on Thursday during the President's speech that Michelle Obama was not standing in her usual spot in the First Lady's box? Who was standing there? Tax cheat and GE CEO Jeffrey Immeldt, Obama's job czar. And, to his left, three other corporate leaders. That is a very telling visual and sums up just about everything that is wrong with this pro-corporate administration.
Think of the American economy this way: It's like a car with a dead battery and vapor lock in the fuel line. You can flush out the fuel line, sure, but the dead battery still prevents the starter motor from turning over the engine. Both problems have to be fixed before internal combustion can take place. Yet it seems the only people who have a serious clue how to break out of this stasis is Joe Lunchpail.
Understandably, business executives are skeptical of the President's nearly $450 billion plan for job creation. One pharmaceutical company in Lexington, Massachusetts said that even if the president's corporate tax rollback put $150,000 in their pockets, it still wouldn't be enough to make them consider hiring even one employee. What they're essentially saying is, "Like the bailout, we'd be glad to pay less taxes, Mr. President. But we're still not hiring no matter how much you put in our pockets."
And for progressives like me, the Obama jobs plan is nothing more than a thinly-veiled corporate bailout on a smaller scale that would cram money in the pockets of multi million and billion dollar corporations like Dollar Tree, Starbucks and McDonald's. Executives of companies such as these are saying, ludicrously, that the economy's to blame for their not hiring workers and they're sitting on their fat asses waiting for a deux a machina.
Gee, whatever happened to the "jobless recovery" or does that apply only to Wall Street?
The reason for the hiring freeze in this country has nothing to do with the economy. Even rapacious sociopaths like corporate executives know damned good and well that you cannot raise consumer confidence and demand for goods and services until people start working again. We could have 100,000 Warren Buffetts each pumping $5 billion into Bank of America and other banks and corporations but it would still not create a single job.
No, folks, the real reason why companies and corporations aren't hiring is obvious: When the job market started drying up in late 2008, they realized how wonderful it was to have 50 people to do the job of 75 or 100.
And with unemployment permanently at the 9% mark or higher, who's going to complain about having to do extra for the same rate of pay?
Maddeningly, small businesses got left out in the Obama plan because small businesses only account for nearly two thirds of all new jobs created over the last 15 years and account for nearly half the American payroll. The corporate tax rollback proposed by Obama would result in middling savings for the average small business owner and would, understandably, not be enough of an incentive to induce them to hire over the long term.
Corporations such as McDonald's, on the other hand, because they have a much larger and wider tax base, would see the biggest tax savings but if you were to ask their executive board if the extra millions a year in tax cuts would spur them to create any additional minimum wage jobs at minimal to no benefits, they'd probably laugh in your face.
If Congress adopts Obama's job plan, the half trillion would disappear just as fast as the bailout money had. It would be, to use former Labor Secretary Robert Reich's metaphor about contractor money in war zones, exactly like pouring thousands of gallons of water onto the desert sand. It would vanish, leaving not the slightest trace of that half trillion.
$50 billion, or less than 1/9 of that money, would be used to create jobs through infrastructure rebuilding, which is great if you have construction experience and happen to live in a state where the work is taking place. But, as with that pharmaceutical company in Lexington, a lot of private contractors who'd get that $50 billion would tell you with a straight face that $50 billion just doesn't create all that many jobs, any more.
I'm not being brilliantly insightful here. Many other minds, better and more pragmatic minds than mine, have been saying for years that the only real way out of this mess is for employers to actually start hiring again. People can only spend money they have.
We're vapor-locked and greed through job consolidation and an orgy of outsourcing, openly championed by the US Chamber of Commerce, are the reasons why so many people are unemployed. The Obama administration and Congress could completely empty out the Treasury and the Fed and pour the rest into Wall Street and it still will not result in a single job being created. Executives keep playing chicken with the economy as if disaster will suddenly flinch at the last moment and they'll keep driving us to that cliff's edge.
And the goose that laid the golden egg, the poor and middle class, will eventually have the final say when they can no longer buy goods and services and begin rioting in the streets.