Corporations DO NOT create jobs

They never have and they never will.

On the other hand, old line Communist countries actually do create jobs as investor Jim Rogers noted in his excellent book, Investment Biker. While circumnavigating the globe on his BMW motorcycle in the early 90’s, Rogers ran into a Congolese match factory donated by the North Koreans.

The problem was that no one in the Congo knew how to make matches and their currency was artificially inflated to the point where they couldn’t competitively sell the matches even if they made them.

As Rogers described, “Every day these seven people came to work at the match factory, did nothing, took vacations for two weeks a year, and returned to do more nothing. They hadn’t made a match in 20 years.”

Oh! And governments create jobs too! Rogers pointed out that, at the time, the Congo National Airline had all of two planes and 400 employees. That sounds eerily similar to the Chicago Street and Sans department right before an odd-year election.

clintonSo if the current crop of crazy conservatives really wanna get behind their “job creators,” may I humbly suggest a Pyongyang vacation adventure or putting a poster of Richard J. Daley on your bedroom wall. You gotta admit, Hizzoner was the archetypal job creator!

But corporations? Unless you count your neighbor bringing his no-account son-in-law into the family business because he’s been fired eleven times, corporations do not create jobs – only demand does!

In the deepest darkest desperate depths of the great depression, if more people purchased your company’s products or services than they did before, you hired folks to fill the gap. At the height of the housing driven early Oughties boom, if your company saw its customers turn to your competition, then you laid people off.

It’s as simple as second grade addition and subtraction.

So with the exception of our aforementioned charitable neighbor, since labor is always the single biggest business expense, no profit seeking corporation in this vast nation will ever hire a single person beyond the minimum required to reasonably provide their product.

And the fact that conservatives completely flipped out when Hillary Clinton shared her keen perception of the obvious in this regard only shows that they’re either utterly disingenuous or not nearly as smart as they purport to be.

Personally, I’ll go with the latter.

One of my former conservative radio co-hosts would routinely pound his fist on the studio table while lamenting that if only the government were a little more light-fingered, his business would be happy to hire another employee! But despite his vociferous protests, putting more money in a business owner’s pocket never translates into hiring more staff.

Never! This ain’t the Congo! If there’s nothing for your new employee to do, then there’s no point in hiring them. Unless demand has increased, taking the tax burden off a business only means more money in the boss’s bank account.

So when Ms. Clinton explained her “corporations don’t create jobs” comment by adding, “…trickle down should be consigned to the trash bin of history. More tax cuts for the top and for companies that ship jobs overseas while taxpayers and voters are stuck paying the freight just doesn’t add up,” she was dead on.

And the fact that conservatives immediately proceeded to shrieking and howling as if another cable channel just picked up Here Comes Honey Boo Boo, doesn’t make her statement any less true.

What utterly baffles me is how the one percenters have so completely conned our generally poorer conservative compatriots into buying their line of blatantly bogus bleep. It’s gotten to the point where they’ll consistently vote against their own best interest by putting more money in their sponsors’ already bulging pockets.

Even though I don’t hold out much hope this dynamic will change anytime soon, at least we can get one thing straight. Whenever a conservative starts talking about “job creators,” remember that they’re actually referring to Communist countries and the expansion of government.

It’s the only way their argument makes sense!

3 thoughts on “Corporations DO NOT create jobs

  1. Neither point of view covers the complexity of business. I think the reality is that supply & demand are interwoven too deeply for these comparisons to call one side more important than the other in driving employment.

    First, consider basic macro-economics. There is a supply / demand curve where the price of goods directly affects demand. A well-run business can offer a lower price, thereby creating more of a demand for an item. At the sweet spot, maximum revenue ensues and revenue pays employee salaries.

    Second, consider the discretionary nature of much of our demand for goods & services. Should a well-run marketing campaign be credited for increased demand of a product? If not, then why are there marketing jobs?

    Third, consider the creation of new goods & services. If a singer creates a popular song, does not the singer create demand by virtue of skill or talent? You cannot credit the work of inventors, engineers, or artists for their work without accepting that the supply of new products & services can create demand.

    Hillary Clinton’s “It takes village” model would work well when it comes to employments. There are many sides to “take credit” for a well functioning economy.

  2. Were those seven Congolese “workers” who did nothing, good union members?

    They need the Fair Employment Practices Commission to intervene to help protect their “jobs.”

  3. Farming creates jobs. If government didn’t provide the biggest welfare program to support farming and agricultural price supports, then there would not be ancillary jobs and goods to make it efficient and productive, let alone attractive. Otherwise, we’d still have plow horses, and small family farms.

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