Government Did Not Build Your Business

[NYcarbineer]

Government Did Not Build Your Business - Reason.com

The 2012 study found that while new business startups created 2.3 million jobs between March 2009 and March 2010, the net job creation from all U.S. private sector firms was minus 1.8 million jobs. The U.S. unemployment rate was then 9.7 percent. The number of business startups has dropped from 554,109 in 1987 to 394,632 in 2010. The 2012 Kaufmann report notes that the share of job creation from young firms has fallen from more than 40 percent in the 1980s to 30 percent now. While acknowledging that the severity of the Great Recession no doubt contributes to this decline in entrepreneurial activity, it is important to note that startups were a major factor in lifting the U.S. economy out of previous economic downturns. Why is new firm creation lagging now? Perhaps it has something to do with the Obama administration’s idea of governance.

First, numerous studies find that higher tax and regulatory burdens impede entrepreneurial activity which in turn slow economic growth and job creation. For example, a 2010 study, "The Economic Effects of the Regulatory Burden," done for the Swedish Agency for Growth Policy Analysis (of all places), found that while some rules are necessary for entrepreneurs and markets to function “that countries with a light regulatory burden show more rapid economic growth in GDP per capita.” A 2008 study, "Government Size, Composition, Volatility, and Economic Growth," done for the European Central Bank examined the effect of government size and fiscal volatility on economic growth for developed countries between 1970 and 2004. The study finds that the bigger government and the slower the growth rate. Every percentage point increase in the share of total revenue going to government decreases overall economic output by more than a tenth of a percent. The report further noted, “Public capital formation may indeed turn out to be less productive if devoted to inefficient projects, or if it crowds out private investment.” Other words, despite the impression that Obama gives, not every government expenditure on infrastructure or a business subsidy is an “investment.”

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Just fitting the narrative that our beloved Bozo-In-Chief really should be retired in Jan 2013 and someone brought in who would be less of a Bozo.

Bozo vs. Less Bozo.

There was a 288 billion dollar tax cut in 2009.

600,000 government jobs have been eliminated since Obama took office.

 

[OODA_Loop]

There was a 288 billion dollar tax cut in 2009.

600,000 government jobs have been eliminated since Obama took office.

If you have a govenrment job you didn't create that, business did.

 

[Bfgrn]

Tell my why I should trust Obama on economic policy again ?

I just did...

 

[OODA_Loop]

Tell my why I should trust Obama on economic policy again ?

I just did...

I appreciate your time to do so.

This independent is voting for Romney as the best choice of the two for the next 4 years this time around.

 

[Steelplate]

and so did the rest of the country...or do only business tax dollars count?

No. It also doesnt mean business owes more taxes.

sure it does....since their actions caused a hell of a lot of the mess we're in. The majority of the people don't have it, our infrastructure is crumbling around us, The good paying jobs went bye bye for the allure of slave labor, our banking sector gambled our 401k's away....REPEATEDLY....so, if business gets all the credit when times are good, they certainly can accept responsibility for their part when times are bad.

Unless you are one of those "privatize profits/socialize losses" kind of guy.

How about this...companies bring those jobs back and pay a good wage and benefits package to employees....and we'll handle the tax issue TOGETHER?

oh...business can do whatever it wants to increase profits? even if it puts our country in dire straits? Well, if that's the case....then fuck 'em. Tax the piss out of them.

 

[OODA_Loop]

How about this...companies bring those jobs back and pay a good wage and benefits package to employees....and we'll handle the tax issue TOGETHER?

I am for this. Obama sent tax money to other countries to build jobs.

The tax issue together means equal contribution across the spectrum.

I think Romney, out of the two, is the best shot to instill the most confidence to make this happen.

 

[NYcarbineer]

There was a 288 billion dollar tax cut in 2009.

600,000 government jobs have been eliminated since Obama took office.

If you have a govenrment job you didn't create that, business did.

The Republicans who claim the government can't create jobs are now beginning to build an argument against the upcoming defense cuts,

that ironically they voted for,

an argument based on the fact that the defense cuts will cost jobs.

 

[OODA_Loop]

The Republicans who claim the government can't create jobs are now beginning to build an argument against the upcoming defense cuts

Chicken still needs to squeeze out the egg to make defense job omelets.

 

[chanel]

A cut in defense spending will cut PRIVATE sector jobs. Dems are only concerned about the public sector.

 

[NYcarbineer]

A cut in defense spending will cut PRIVATE sector jobs. Dems are only concerned about the public sector.

So if the taxpayers are funding a private sector job, that somehow doesn't count as government spending?

Who told you that?

 

[chanel]

Huh? Of course it does. But it also benefits private businesses and the communities that host those businesses.

Here in NJ, Gov. Christie has asked all mayors to do the "yellow book test". If a service can be provided by private industry, rather than public employees, he wants them to consider 'outsourcing". He believes that will provide the needed service at a lower cost to the municipalities.

I have no problem with tax dollars being used to build roads and bridges. Very few people do. But private contractors do most of the actual work. That is what we call a partnership.

If Obama had his way, every bridge builder would be on the govt. payroll. Forever.

 

[Steelplate]

How about this...companies bring those jobs back and pay a good wage and benefits package to employees....and we'll handle the tax issue TOGETHER?

I am for this. Obama sent tax money to other countries to build jobs.

The tax issue together means equal contribution across the spectrum.

I think Romney, out of the two, is the best shot to instill the most confidence to make this happen.

no, it does not mean equal contribution. But it does mean that more of the folks that the right continually harp on...those that pay no federal income tax...will be doing so.

a flat tax does nothing more than hurt the people who need the money in their pockets the most.

Confidence? they don't need confidence....they've sold the country out of their own accord....not because they were fearful, but for huge profits that increased their personal wealth by some 600%....Once again....stop acting as though big business is an innocent in all of this. Make them accept responsibility, instead of making excuses.

 

[OODA_Loop]

no, it does not mean equal contribution. But it does mean that more of the folks that the right continually harp on...those that pay no federal income tax...will be doing so.

If you don't make income why should you pay income taxes?

I don't want to pay income tax on money my money made me. I pay capital gains on that.

 

[Bfgrn]

Tell my why I should trust Obama on economic policy again ?

I just did...

I appreciate your time to do so.

This independent is voting for Romney as the best choice of the two for the next 4 years this time around.

Well, if you believe our founding fathers created a plutocracy, go for it. I have been around since Harry Truman was in the White House. I've seen the catastrophic end result of two revolutions based on pure ideology and doctrinaire. The Bolshevik revolution and the Reagan revolution.

Russia had it's Marxists and America has it's Marketists. Both cut from the same cloth.

The Bush/Republican decade created ZERO jobs... We need to double down and do it again?

 

[rightwinger]

Huh? Of course it does. But it also benefits private businesses and the communities that host those businesses.

Here in NJ, Gov. Christie has asked all mayors to do the "yellow book test". If a service can be provided by private industry, rather than public employees, he wants them to consider 'outsourcing". He believes that will provide the needed service at a lower cost to the municipalities.

I have no problem with tax dollars being used to build roads and bridges. Very few people do. But private contractors do most of the actual work. That is what we call a partnership.

If Obama had his way, every bridge builder would be on the govt. payroll. Forever.

When has Obama ever proposed such a thing? You are just making shit up

 

[OODA_Loop]

I just did...

I appreciate your time to do so.

This independent is voting for Romney as the best choice of the two for the next 4 years this time around.

Well, if you believe our founding fathers created a plutocracy, go for it. I have been around since Harry Truman was in the White House. I've seen the catastrophic end result of two revolutions based on pure ideology and doctrinaire. The Bolshevik revolution and the Reagan revolution.

Out of the two choices, Romney simply posessing the keys to the office will instill confidence and free up capex.

Then jobs will follow.

Without that, the other stuff matters not.

Then we will see what the next choices are in four years.

It wasn't Reagan was so great. He wasn't Carter.

 

[Steelplate]

no, it does not mean equal contribution. But it does mean that more of the folks that the right continually harp on...those that pay no federal income tax...will be doing so.

If you don't make income why should you pay income taxes?

I don't want to pay income tax on money my money made me. I pay capital gains on that.

why not? It's still income....is it not? It still goes into your pocket....that's income. It doesn't matter how you acquired it....it should be subject to the same rules....only on the profit or interest....not the principal....you already paid taxes on that.

 

[OODA_Loop]

why not? It's still income....is it not? It still goes into your pocket....that's income. It doesn't matter how you acquired it....it should be subject to the same rules....only on the profit or interest....not the principal....you already paid taxes on that.

You could change tax code.

 

[Listening]

People on the right have never really understood how markets work.

O.K.

I'm game.

I've always enjoyed your posts as challenging even though I disagree with them most of the time.

I am assuming you are going to explain how markets work.

The goal of any business is to increase market share.

Shareholders want market share.

O.K.

First disagreement.

The goal of any business is to maximize value to the shareholder. You can get all the marketshare you want by making your product for $1.00 and selling it for $0.90. You won't last long, but you would increase marketshare.

The goal of business is to maximize profits. In order to maximize profits, you are constantly looking for ways to increase marketshare for your product as long as you can sustain your margins.

Enron is a classic example of a company pushing to expand volume and screwing themselves (and others) in the process.

Some companies, like Wal-Mart, are built on volume.

Other companies, like Roles-Royce (back in the day) know they had a limited market and sought to maximize return on what they knew would be limited sales. RR never attempted to get into the compact market from what I understand.

I also hope your realize that there is a danger to a company in growing to fast. I won't go into it, but if you need further explanation, let me know.

So, I am a little curious to see where the rest of this goes.

Boards of Directors fire CEO's who do not build market share.

I can't agree with this.

Assuming a CEO is actually accountable (something that really does not seem to exist), their charter is to take the company in directions that include maximum profitability and long term sustainability.

A monopoly is the point of building market share.

There is only so much market for a product.

The objective of a monopoly is to get control of price.

Steve Jobs doesn't want competition. He wants every tablet user to own an iPad.

He does not want competition pulling down the price of is tablets.

Market share is a part of it, but I believe you've not hit what is important....still may not matter later on.

The largest corporations have enough capital to fund elections and staff government. They have enough money to capture whole regulatory bodies.

The right does not understand this ???

Are you kidding ?

The right, wants free open markets. You seem to equate that to being a corporatist.

Once a company gets big they can control the market entry barriers.

You think the right does not realize this ???

In short, large corporations buy government and media assets in order to create the legal, regulatory and discursive environment for building and sustaining monopolies. Eli Lilly, by pumping money into congress, was able to shut down competition from generic and foreign competitors. Big oil did the same with energy. They successfully defended their control over energy from a host of different challenges.

And your point is what ???

What we've been saying for years.

That it has gotten to the point that you can't tell the difference between government and big business. I work for a large corporation. I see how they are constantly scratching the backs of government regulators (even hiring some top EPA officials to keep pipelines of communication open to regulatory bodies). The help write regulations so that getting in the market is tougher and tougher for new entrants.

A classic example of this was biodiesel. Once you got some big players in there, they wrote the fuel specs for the stuff so that there were going to be some pretty expensive (and useless) processing steps added to the small manufacturer...to keep them out of the game. They also got the government to require a bunch of expensive tests on each tank of fuel....tests that would force the lab costs of a small guy way up (a tank could be 100 gallons or 10,000 gallons,....so the cost of testing over a large tank was a lot less....).

Another classic (which the left won't acknowledged because they love to call health care a market failure) is the propping up of insurance by government. I know people who have looked into starting insurance companies. These were doctors who hoped to offer simple plans that would meet almost all of the goals of ACA (long before we ever knew who Obama was) and found that the cost of all the regulations and filings just to get going (insurance companies, as you know are huge investment houses....something they didn't want to do....but that is how the government saw them and that was how they were going to be treated....you did what the government said....or no deal). The gave up. It was a darn shame too.

Capitalists don't want competition. Their shareholders win biggest when they capture the largest possible block of consumers. The point of business is to achieve a monopoly so that you can raise prices without fear of having your customers stolen.

I think we might be saying the same thing...but just to be precise.

You can raise prices without having a monopoly. You can have an oligopoly.

Your goal is to maximize profits and you do that by keeping the competition to a minimum. That is achieved by getting barriers to entry up high.

You made the comment that the right does not understand how markets work.

I say garbage. We understand this completely.

What I suspect you may be whining about is the desire on the part of the right to keep government from regulating competition or regulating business.

Government should be there to prevent unfair practices. We agree that companies will take what advantages they can get. But that is the dynamics of the market, not the equilibrium so many people get confused with.

Basic economics says that price is the "invisible hand" that clears markets, when in reality it is volume on most items.

We are used to seeing gas prices move all over the place.

I have watched the price of canned tunafish sit at the same level for years.

Different markets have different dynamics.

Now, back to government and markets. When the airlines were regulated, competition for gate space didn't exist. It was doled out and created dominance in certain areas. It also allowed airlines to do things like offer lunch on hops like Phoenix to Denver. It didn't matter...people were going to pay.

When they started looking at deregulation, who do you think was opposed to it ? The airlines. They liked their government lined featherbed.

My family was involved in a travel agency. There were guaranteed commissions for selling airfare. The didn't like the idea of regulation. The knew their commissions would get cut.

Competition opened up. New airlines formed.

And prices dropped: I can recall that in the mid 70's a ticked from Phoenix to Denver was over 400 dollars. You flew on a 707, had a nice wide seat, and got a nice meal...you can get that same fare for less than 200 now..if you shop...you might fly on a cramped commuter jet and of course you get a pop and maybe some nuts...want to pay $400...you can go first class......

Who signed the bill into law?

Here is a hint: It was signed in 1978.

America by Air

Reagan, for instance, was funded massively by big oil. Remember: Carter posed a threat to big oil. Cater desperately wanted energy competition. Carter predicted that our reliance on high petroleum use would lead to crippling gas costs. He wanted alternative energy and conservation to compete with big oil - to pose solutions which eroded the market share of big oil and forced them to lower prices to retain customers. Reagan successfully defeated the challenges posed to big oil. He used government to solidify the monopoly power of big oil and he tied consumers to energy costs that would some day destroy the economy. This is what happens when special interests capture politicians and rig markets. Reagan helped rig the market in favor if his donors. The Left does the exact same thing.

O.K. This one is going to be difficult to unravel. You've said way many things that are only half true. And left a whole lot out.

Carter was in the 70's. We got nailed in 73 by OPEC. Our domestic inland product was on the decline and we would not build refining capacity to meet demand. Nixon's EPA helped seal that one. We were vulnerable. Carter was no threat to big oil.

Carter was an idealist. He wanted alternative energy. If that had come about, the companies that control the distribution would still control the distribution. Oil was in, one way or the other. Big oil has always looked at alternative energy and played both sides of the game. Nebraska built about 10 large ethanol plants long before the ethanol plant explosion. They had all kinds of names, but if you checked into them, large shareholders (never majority, 40 and 45%) were names like Texaco, Chevron, and BP. These companies have always had R&D for alternative energy. If the day comes that it makes sense....they will be there. Do you see Exxon running their adds (currently) for algae technology ?

Back to Carter.

Here was from his speech in 1977:

"We simply must balance our demand for energy with our rapidly shrinking resources."

Shrinking resources ? They were not shrinking. This was all tripe that he had made up. How many times have you heard about the "peak" and each time we find more oil (or find ways to get it out of the ground...there is still more in the ground than ever....getting at it often isn't cheap). Carter had it wrong.

Here was his warning cry in the same speech:

"We will have a crash program to build more nuclear plants, strip-mine and burn more coal, and drill more offshore wells than we will need if we begin to conserve now. Inflation will soar, production will go down, people will lose their jobs. Intense competition will build up among nations and among the different regions within our own country. "If we fail to act soon, we will face an economic, social and political crisis that will threaten our free institutions."

Now, do you recall gas hitting $1.25 about three years ago ? Why do you think that happened ? If we let supply and demand (and demand also means refining demand) balance out, we'd be in great shape.

Right now, we can't hardly refine but about 50% of what we need. Producing more makes little sense if you can't get at it. You know where those refined products come from ? Huge export refinereis in the Middle East and India. They have large complexes that are so good and so flexible that they shut down about 750,000 BPD of already limited refining capacity on the U.S. East Cost. And the large refinery in St. Croix (which was partly bought up by Chavez and run into the ground) is also shut down. The market adjusts. But the people who control the price are those who produce the oil. They restrict supply and we let them. Because we won't drill and refine it ourselves. It is out there. look at the Canadian oil sands...it is out there. BTW: Canada has recently found huge reserves of convetional oil too. There is no peak.

Republican voters who talk about free markets don't get it.

Bulls**t. You've shown you are not really as inside the issue as you think.

None of the corporations who exist inside markets want a free market - they want market share; they want monopolies - they don't want competition to destroy their profits.

Hello. The "right" does not get this ?

Competition erodes market share.

It erodes price. But I think we are saying the same thing.

Corporations use their profits to buy regulators and politicians in order to rig markets and get more market share. This allows them to raise prices without losing consumers to a competitor. Once you understand this, you will understand what has happened to U.S. capitalism since Reagan. We now have a bunch of special interests running the economy.

Reagan isn't the problem.

We were moving to a global economy and technology was outstripping our ability to innovate (with it).

Big companies found new markets and got more powerful. They then turned to the govnerment to assist them in preserving those markets. That isn't just a sin of the GOP.

Obama has blatently done the same thing with GM and GE. The new light bulb craze shut down a plant in VA and put people out of work. That will never come back. As I understand it, conventional bulbs are now being made offshore. Obama tried Solyndra. Failed. He's tried others. He's trying to control the market....an arrogant and ignorant effort.

The big problem is that we have no means to fix this problem.

Hunh ?

Sean Hannity is paid by the same special interests who run the economy to defend these monopolies as "freedom". Sean will never tell his voters that companies like Eli Lilly and Exxon can raise their prices because Washington has helped them destroy the competition. If you try to break the monopolies and restore competition, Glen Beck screams "socialism".

Oh, please don't tell me you don't think the left is any better.

First, Bill O'Reilly went after oil when prices spiked. He was arguing with Beck and Stossel about getting gouged. He was passionate. He was also wrong. But don't say the right does not call it out. Shultz would only economics if he took time out from beating the women in his life to read up on it.

As someone who is familiar with chemicals and refining, let me assure you that through the early 80's companies tried to expand. They saw the expanding demand and they knew, in spite of Carter, that there was lots out there. The U.S.A. had firmly defeated any efforts by companies to build new refineries. I can point to a case in Arizona where a fellow has been trying for almost 30 years to get the permits he needs to build a simple topping refinery. He has had to move locations and go through countless hearings only to be defeated by environmentalist groups time and time again. All oil people have been through this. They just scratch their heads. But the also know that this helps keep the little guys out. The don't like it, but they take advantage of it too.

They now just invest overseas where they can get it done. They can participate in the supply restrictions through their global supply networks without the U.S. touching them. They are no longer U.S. companies.

And they let refining to someone else. Do some research and you will see Exxon has sold off a lot of it's refining capability in the U.S. Why ? To focus on E&P. That is where the money is. Some other fool wants to fight Uncle Sam to refine....let him.

God help us.

Obama certainly won't.

I am a little disappointed at your post. First, I am not sure why you even put it up.

Second, it is not true what you say about the right.

The GOP in D.C. are not the right. They are crooks just like Ried and Pelosi and they bend to big money just like the rest. This is about small business. Small business is not refining. It is service and supply companies and small manufacturing that can't get going because of....the barriers to entry created by our wonderful state and federal governments.

If you think the right does not understand this....you are really an idiot.

 

[Listening]

“If you've got a business, you didn't build that. Somebody else made that happen”

Barack Hussein Obama

IF Obama said that it was a rather silly thing to say.

That is really only true for some businesses whose primary customer is (or was) the US government.

Most small businesses don't have the US government as their primary or at least one of their major customers.

Obama was talking about roads and bridges. Conservatives love to take things out of context and their loyal minions don't know the difference

It was simply a summary line and it is not out of context. We know just what he was saying and why he is saying it. You might read the article instead of acting like a lemming drone and using the word minion because the guy holding the rope to the ring through your nose told you to use it.