Obama's Jobs Destruction Act
In his speech Obama didn't say "stimulus" once. He wants to stay away from that word, last stimulus was a failure and unpopular.
Of-course deficits that finance the stimulus destroy more jobs than the tax cuts create.
None of it is paid for, cuts from future increases is not paying for anything, but there is net increase in deficit (and it's underestimated) 450 Billion USD year 2011.
Debt ceiling now will have to be raised again obviously next year, because this is 450Billion that are not accounted for in the last debt ceiling increase.
Tax credit for hiring people who are unemployed for more than 6 months. So now employers will have incentive NOT to hire anybody who hasn't been unemployed for 6 months
7.25 - is minimum wage. 4000USD is given as tax credit, and you have to keep the person for 6 months minimum.
So hiring somebody at 7.25USD/hour and given 4000USD credit reduces minimum wage to 3.40USD/hour.
Minimum wage will be reduced, and so there WILL be more employment, but some people will be FIRED to give more space for new minimum wage hires because of the tax credit.
Bill will make it illegal to discriminate against long term unemployed. So what will happen is that people who are long term unemployed will NOT be interviewed. Who wants to have a lawsuit on their hands?
If anybody is unemployed for 4-5 months, now there is a reason not to hire them right away, to interview them and to keep them on UI for another 1-2 months and then to get the tax credit once they are at 6 months unemployment time.
Of-course fire anybody after 6 months, get new hires. It's all going to be minimum wage jobs, nobody who is hiring people at good salaries will care about 4000USD tax credit.
The 1 year cut in SS payroll tax will make SS that much more broke (it's broke now, but it can be made worse.)
To pretend that there is SS "trust fund", gov't will borrow money, put it into "trust fund", borrow from "trust fund" and spend it on stimulus. Many lies all around.
If you hire a returning veteran, the tax credit is 5600USD. Applied to minimum wage, it makes minimum wage 1.87USD/hour. This creates huge government incentive to have very high turnover.
Payroll taxes will be lost on existing jobs, ha ha. They'll have to print more money.
For returning veterans with injuries (wounded warrior), you get 9600USD tax credit. For a minimum wage job this makes the pay a NEGATIVE ONE
Hire as many wounded warriors as possible immediately and just pay them, but the employer gets 1.98/hour for every new hire. Hire all of them and have the Fed monetize the debt that will be created paying these tax credits.
How do you like them apples?