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News-Sentinel.com Your Town. Your Voice.
Opening Arguments


It may be true, as many conservatives like to point out, that government can't really create jobs. But it sure can kill them, in more ways than one. There is death by regulations, for example:

Since the 1950s, the number of U.S. workers needing an occupational license—effectively a government permission slip to work—has grown from one in 20 to nearly one in three, according to a 2010 study. . .

One in three! Then there is  death by taxes:

In 2010, however, Congress, ravenous for revenues to fund Obamacare, included in the legislation a 2.3 percent tax on gross revenues — which generally amounts to about a 15 percent tax on most manufacturers’ profits — from U.S. sales of medical devices beginning in 2013. This will be piled on top of the 35 percent federal corporate tax, and state and local taxes. The 2.3 percent tax will be a $20 billion blow to an industry that employs more than 400,000, and $20 billion is almost double the industry’s annual investment in research and development.

[. . .]

Cook Medical is no longer planning to open a U.S. factory a year. Boston Scientific, planning for a more than $100 million charge against earnings in 2013, recently built a $35 million research and development facility in Ireland and is building a $150 million factory in China. (Capital goes where it is welcome and stays where it is well-treated.) Stryker Corp., based in Michigan, blames the tax for 1,000 layoffs. Zimmer, based in Indiana, is laying off 450 and taking a $50 million charge against earnings. Medtronic expects an annual charge against earnings of $175 million. Covidien, now based in Ireland, has cited the tax in explaining 200 layoffs and a decision to move some production to Costa Rica and Mexico.

The medical device business is significant in Indiana, with the potential to grow even more, so this is a big deal for us, and we should hope efforts to repeal the tax are successful.

It should be noted that a lot of the licensing is not so much imposed by the state as demanded by those subject to the licensing, as a way to keep the riff-raff out. When a bill was introduced during the latest session of the General Assembly to do away with licensing for such professions as barbering and cosmetology, there was a storm of protest from, among others, barbers and cosmetologists.


Sat, 05/12/2012 - 12:41am

But government can, and does, create jobs. Most obviously it created the jobs of the congressmen who keep claiming that government doesn't create jobs. (Those same congressmen complain about the socialized medicine whose benefits they themselves enjoy.) Every time government decides to build a road or a bridge it creates jobs. When Fort Wayne decides to cut down ash trees it creates jobs. The military recruitment offices create jobs. This is a case of repeating an obvious lie so often people begin to believe it. I'd personally like to see a WPA or CCC program to at least provide work for the millions who have simply given up looking. The fact that our bridges, parks and roads would be improved would be a side-benefit. Unions would gripe about the low-paid competition, but conservatives don't like unions anyway. It's a win-win.

Sat, 05/12/2012 - 5:46am

Government does not create jobs once opportunity cost is factored in.  Government removes dollars from the economy to pay for bridges,  roads and cutting trees.  Had those dollars been allowed to remain in the private sector, they could have been spent creating employment and wealth.

Ergo, the jobs that government "created" would have been created privately and there is no net gain.

Christopher Swing
Sat, 05/12/2012 - 8:52pm

And it would be foolish to "remove dollars from the economy" to build/maintain bridges and roads, since obviously those dollars disappear forever (extraterrestrials are the labor) and we have all those private bridges and roads that replaced all the public ones.