Job’s Bill Just Doesn’t Add Up in Bigger Picture

This week Senate Majority Leader Harry Reid announced that he had the votes to pass a "jobs" spending bill through the Senate. Reid made the announcement with knowledge that Republican Senators Scott Brown of Massachusetts and Olympia Snowe and Susan Collins of Maine would vote yes on the bill and its spending measures. Brown justified his vote in favor of the bill on the grounds that Democrats included tax cuts for businesses as part of the package. While the tax cuts are nice, the logic behind Reid's bill and Brown's decision to vote yes just doesn't make any sense.

According to Reuters the bill will give tax credits to businesses that hire currently unemployed individuals and retain the employees for at least a year. It has not been specified whether or not businesses will be able to claim credits for multiple employees. $15 billion in federal funds will be set aside for potential credits. Along with the tax credit, which was used to recruit the support of the three Republicans, the bill will set aside up to $20 billion for highway construction across the country. Overall the net spending from the bill could top $35 billion.

While Brown and his two New England counterparts will attempt to justify their voting logic on the premise of cutting taxes that logic is severely flawed and lacks an understanding of how tax cuts can be used to stimulate the struggling economy. The yea votes on the part of the three Republicans, and most Democrats, cannot be viewed in a fiscally conservative light because they fail to take into account the fact that when taxes are cut something else must give in another part of the government. In essence you must also cut spending to compensate for the loss of revenues.

Cutting taxes is only one portion, albeit an important portion, of a fiscally responsible strategy to stimulate the economy. Anytime you cut taxes you must also cut spending; otherwise your economic result will be soaring deficits and a bloated national debt. It's a fairly clear-cut approach to the economy that all politicians should lean and understand because in recent years they've continually violated it. During the Bush year's taxes were cut while spending remained high. The result was an economic downturn at the end of the administrations eight years in office. Now the Obama administration and the progressives in Congress are attempting to revolutionize the irresponsible Bush policies by one-upping them. In order to appease voters and Scott Brown they're cutting taxes, but instead of maintaining high spending in the tax cut bills they're going to drastically increase it.  The American people have come to understand the fact that Democrats wish to increase the size of government but they should be baffled by the fact that they wish to increase the size of government without paying for it. It is this sort of economic malfeasance that will pass on drastic shortfalls and debt to future generations.  As Thomas Jefferson said in 1816, "I sincerely believe... that the principle of spending money to be paid by posterity under the name of funding is but swindling futurity on a large scale".

The Jobs bill is a clear-cut example of the progressive's new policy of drastically increasing the size of government while passing on debt to later administrations and the American people. While the tax credits are good and will create a few jobs it is irresponsible to cut taxes by $15 billion then increase government spending by putting $20 billion towards highway construction. How can the government pay the $20 billion when it will be taking in $15 billion less at the end of next year?

The American people should also take issue with the fact that progressives are attempting to create jobs in the area of highway construction. Will the $20 billion create some jobs for highway construction? Yes, more than likely. But will they be effective jobs in the long run? Probably not. There are a few reasons for this. Firstly the jobs will be temporary. For a short period of time people will be employed to work on the new roads but what happens when the roads are complete? Either a) the employees will be out of work, or b) the government will have to shell out another $20 billion that it does not have to keep them employed on some new project. There are also issues about how many unemployed individuals the highway work will give jobs to. Knowing the history of the progressive agenda it is likely that the construction workers will come from politically favored unions that will demand higher wages than your average unemployed American.

The fact that union labor will likely be utilized (as was the case under most stimulus projects) should raise the question of whether any unemployed individuals will be brought back into the fold for highway work. Not to criticize unions, but if the government is going to spend money for job creation it should ensure that all Americans are eligible for the new jobs.

The bigger issue with spending on highways to create jobs is a broader one that distinguishes the difference between what it means to be a true fiscal conservative as opposed to a progressive. Someone who prescribes to the theory that new jobs should be created on the government's dime (and thus the people's dime) believes that the public sector and thus a bigger government is the future of the United States.  While this would create jobs it runs counter to the idea that the country is a prosperous place where any individual can work hard and succeed on their own merit. A society in which individuals are steered towards the public sector and in which the private sector is denounced is a society in which the individual will cease to exist. Do we really want a society without risk and without work in which the government makes our life decisions, such as where we work, for us? A true fiscal conservative should act on the principles of cutting both spending and taxes in order to let free enterprise and free individuals work towards success.