General Discussion

The RW theory: if the government gives a company a tax cut, the company will spend its new benevolence on hiring.

And if the government gives the rich a tax cut, companies that report taxes on their owners' personal tax forms will spend their benevolence on hiring.

Reality: Businesses create jobs (as opposed to replacing workers who quit, died or whatever) for one reason only: there's more work than current staff can handle. They don't hire people who will have nothing to do, which is what the "tax cuts create jobs" meme suggests.

Before we go on, there was one tax cut that did create jobs: Kennedy's. He backed us out of wartime taxation at the dawn of the machine age. The cut was simultaneously large enough to allow serious private investment to happen - and small enough to let the government go on shooting men into outer space and covering the nation with four-lane divided highways. The conditions surrounding that cut will never happen again.

The government is the biggest consumer in America, and their spending has three distinguishing marks: they spend in the private sector, they buy American and they buy a lot. The government doesn't buy a car - they buy ten thousand of them. They don't buy a can of beans, they buy four truckloads. Government spending causes shifts to be added at factories. And tax cuts stifle this beneficial spending. Go through the government's U3 and U6 stats: every time there's a tax cut, unemployment rises.

The far right claims an individual can spend his money better than the government can. Wrong answer: not even the Walton family can buy enough cars to make Ford add a night shift, but the government does it every year.

Since they don't hire with tax cuts, you may wonder what corporations do with these riches bestowed by the benevolent feds. In many cases, they use them to trash the economy. Corporations invest, and in many cases they invest in the Mitt Romneys of the world. In others, they buy companies themselves. Ever wonder why there hasn't been a new brand of anything but craft beer in years? A long time ago, a company that wanted to sell sausages would hire a sausage chef, dream up a name and build a factory. Now they buy out another company, fire the workers and move the sausage machine into their own factory.Jobs are lost and communities devastated.

Responsible government spending, which is the majority of it, does more for the economy as a whole than tax cuts can.