President Barack Obama has compiled a handy to-do list for Congress that, “if acted upon quickly, will create jobs and help restore middle class security,” according to the White House’s blog. And it’s about time. This is most certainly not, as cynics might suggest, another transparent political scheme. After all, these initiatives, the White House claims, enjoy bipartisan support — which, I gather, is meant to impress you, even if it’s not exactly true.
Regrettably, the sentiment of the to-do list does garner bipartisan support and illustrates how cheap populism leads to bad policy and why Washington shouldn’t be in the business of “creating jobs” in the first place.
Obama says passing his to-do list would help create “an economy built to last — one that creates the jobs of the future and makes things the rest of the world buys — not one built on outsourcing, loopholes, and risky financial deals.” History tells us that when government “creates” an economy, it won’t be much of an economy to speak of — but here’s the new plan:
“Reward American Jobs, Not Outsourcing.” Hey, let’s play on the genuine frustration of struggling Americans. Most politicians will latch on to this protectionist notion to some extent. But need it really be repeated that outsourcing, by generating more productivity, creates more wealth and more jobs? On this point, most economists actually agree.
But even if you believe “outsourcing” is a job killer, does anyone believe the notion that “passing legislation that gives companies a new 20 percent tax credit for the cost of moving their operations” will make a dent on employment? Liberals frequently argue that high corporate taxes aren’t chasing companies abroad, yet a one-time tax break on moving expenses is now a cornerstone of “an economy built to last”?
To do: “Create Jobs By Investing In Affordable Clean Energy.” It is difficult to calculate just how many subsidies and breaks are already “invested” in unproductive clean-energy projects — many of them supported by Republicans. Whether it be morally fulfilling or good for the environment, an expansion of “the 30 percent tax credit to investments in clean energy manufacturing” could cost jobs, not create them. As one Spanish study found, 2.2 conventional jobs are destroyed for every job created in the alternative energy industry. “Investing” in inefficient energy is no way to economic growth.
There are other feel-good to-dos on the list: “Invest in a New Hire Tax Credit For Small Business,” wherein Washington jump-starts new hiring by giving “a 10 percent income tax credit for firms that create new jobs or increase wages in 2012.” Losing money? Give a raise; get a tax break.
Then there is the admirable “Put Returning Veterans to Work Using Skills Developed in the Military.” (Hey, Republicans, why do you hate veterans?)
Also to do: “Cut Red Tape So Responsible Homeowners Can Refinance” — wherein Congress passes legislation to cut red tape in the mortgage market, allowing “responsible” homeowners to refinance at today’s lower rates. Guess what? Banks already allow responsible homeowners to refinance, and there are tons of government programs designed to help homeowners. Is it good for the economy? That’s another story.
But according to White House press secretary Jay Carney, the function of the to-do list is that it ensures that come election time, Republicans will have to explain to their constituents “what they did while they were in Washington these last two years. Did they just say no?”
Correct answer: I didn’t say “no” enough.
The problem is that so-called fiscal conservatives say “yes” too often to populist notions masquerading as policy. With the state of the economy, what’s scarier, that the administration would pretend that these are serious proposals or that the president might actually believe they are?
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