4 ms·

His major complaint, to quote the article is this: "Who is stimulating the economy? Me, the guy who has provided 14 people good paying jobs and serves over 2,2

His major complaint, to quote the article is this: "Who is stimulating the economy? Me, the guy who has provided 14 people good paying jobs and serves over 2,200,000 people per year with a flourishing business? Or, the single mother sitting at home pregnant with her fourth child waiting for her next welfare check?" What he apparently doesn't know is that 75% of the (American) economy falls under "Consumer Spending". That is, if you and I don't blow our paycheck buying clothes and cars, we don't have an economy. So really, the government is doing The Right Thing(tm) by stimulating the economy. It just upsets this guy because he feels that "Trickle Down" is better, because then the economy is sitting around waiting for this guy to buy/lease another Mercedes.

gaius 18y ago
Except that he states he'd use the tax money to hire more employees - who would be both consumers and producers.
- redrobot5050 18y ago
  No, he wouldn't. The fact of the matter is, if he had the business, he'd hire the employees, as they would be making him money. Just like the myth that he'd "pay his employee's more" if he didn't have to pay their payroll tax. Odds are, he'd pay his employees the going rate for their labor. Or, if he believes his employees deliver an above-the-market quality of labor, he'd pay them at what is an appropriately scaled competitive wage. The rest he would pocket. You hire someone because you need someone to do a job. You don't have a mythical set of employees doing nothing/odd jobs simply because you have a "tax surplus".
  - gaius 18y ago
    That's clearly not a fact at all! There are lots of things that companies do that aren't directly billable to clients. What is a fact is that either you spend the money paying someone to do something, or you spend the money paying someone to do nothing.
    - redrobot5050 18y ago
      >That's clearly not a fact at all! There are lots of things that companies do that aren't directly billable to clients. Yes. Like I said before, you hire for your business based on need. The idea you'd have "more employees" because of a "tax surplus" is a myth. Especially from business owners that condescend to their employees and coerce their votes. I've worked for people just like this guy, and believe me, the idea he is spouting off is ridiculous.
      - DanielBMarkham 18y ago
        Is it just me? I find the phrase "tax surplus" to be Orwellian. Do you mean keeping your own money? If so, why not just say so? People hire based on need. But people also hire based on productivity, available workforce, labor laws, legal considerations, tenure, etc. There are all kinds of modifers to the basic "need" I may need another employee, but the bar might be so high to hire them that I don't do it. In that case, existing employees just have to work harder. Simply because a company has a need doesn't change their break-even analysis. And taxes hit the break-even analysis directly as overhead. Right? Or am I missing something?
        redrobot5050 18y ago
        If you'll allow me to conceed you've got a point, I'd like to offer a rebuttal that takes us in a new direction. (Again, yes, you're right about the break even analysis). Aside from the basics (roads, schools, telephone lines) that the taxes on his employees pay for, there is one thing the payroll tax pays for as well: Unemployment insurance. Now, nobody wants their business to fail, but the failure rate for businesses is quite steep. This is a tax that literally protects the employees from the bad business decisions made by the business owner, even if he ends up bankrupt. Unemployment also keeps the supply of labor at a fairly constant rate. Say I worked for one of this business owner's competitors, who went out business, and have a mortgage. To make ends meet, I immediately take a job in an unrelated field. Now, that business cannot hire me because I've stopped looking for a job. (I know, i'm simplifying here, bear with me.) Unemployment lets me spend more time on the market, looking for offers in my field. Sort of like FDR's Treasury Secretary said about the New Deal. "People don't eat over the long term. They eat everyday."
astine 18y ago
Capital spending, contributes just as much to the economy as consumer spending. More so in fact, as capital can be used to produce more goods an consumer goods cannot. This fellow spends a hell of a lot more than most of us, and on goods which will contribute to the economy in more substantial ways than anyone purchasing a television would. --- That said, I totally disagree with the tone of the letter, which betrays a level of pride and arrogance. The fact that he's threatening his employees rather than attempting to earn their loyalty, says a lot about the man.
- redrobot5050 18y ago
  But consumer spending is easy to stimulate. Just give consumers more money to spend. Economists still argue what works best to stimulate businesses. There's no one right way to do it. Some believe in deregulation. Some believe in low business taxes. Some believe in business-ownership tax incentives. Some think lax credit laws or "high liquid markets" make it happen. Others, like the letter writer, believe in trickle down and low taxes for business. An aside, anyone with a functioning brain that lived through the Reagan era knows this to be a complete falsehood. Second, its been observed (again, this is like some people say, so take with a grain of salt) that many pro-low tax people cannot control their lifestyle spending. Therefore, the only way to increase their ability to repay on their debt/save money is to reduce their tax burden. I've worked for a small business owner like this. They're small minded and arrogant beyond belief. They don't respect the people who work for them. "Penny smart, but pound foolish" as the expression went. He was sure to talk to us, off company time, in 2004 to remind us how dangerous it would be to vote for John Kerry because of his plan to force businesses to offer health care. At the time, none of us working there had health care, except the owner. He had a private policy which he could afford because he paid himself such a high salary. We would make $20/hr (with no benefits) and he would pocket $60/hr from our labors. He was eventually forced to offer health care anyway, once most of his top employees (and me!) left to companies that provided benefits and didn't treat you like cattle.

gaius 18y ago

Except that he states he'd use the tax money to hire more employees - who would be both consumers and producers.

redrobot5050 18y ago
No, he wouldn't. The fact of the matter is, if he had the business, he'd hire the employees, as they would be making him money. Just like the myth that he'd "pay his employee's more" if he didn't have to pay their payroll tax. Odds are, he'd pay his employees the going rate for their labor. Or, if he believes his employees deliver an above-the-market quality of labor, he'd pay them at what is an appropriately scaled competitive wage. The rest he would pocket. You hire someone because you need someone to do a job. You don't have a mythical set of employees doing nothing/odd jobs simply because you have a "tax surplus".
- gaius 18y ago
  That's clearly not a fact at all! There are lots of things that companies do that aren't directly billable to clients. What is a fact is that either you spend the money paying someone to do something, or you spend the money paying someone to do nothing.
  - redrobot5050 18y ago
    >That's clearly not a fact at all! There are lots of things that companies do that aren't directly billable to clients. Yes. Like I said before, you hire for your business based on need. The idea you'd have "more employees" because of a "tax surplus" is a myth. Especially from business owners that condescend to their employees and coerce their votes. I've worked for people just like this guy, and believe me, the idea he is spouting off is ridiculous.
    - DanielBMarkham 18y ago
      Is it just me? I find the phrase "tax surplus" to be Orwellian. Do you mean keeping your own money? If so, why not just say so? People hire based on need. But people also hire based on productivity, available workforce, labor laws, legal considerations, tenure, etc. There are all kinds of modifers to the basic "need" I may need another employee, but the bar might be so high to hire them that I don't do it. In that case, existing employees just have to work harder. Simply because a company has a need doesn't change their break-even analysis. And taxes hit the break-even analysis directly as overhead. Right? Or am I missing something?
      - redrobot5050 18y ago
        If you'll allow me to conceed you've got a point, I'd like to offer a rebuttal that takes us in a new direction. (Again, yes, you're right about the break even analysis). Aside from the basics (roads, schools, telephone lines) that the taxes on his employees pay for, there is one thing the payroll tax pays for as well: Unemployment insurance. Now, nobody wants their business to fail, but the failure rate for businesses is quite steep. This is a tax that literally protects the employees from the bad business decisions made by the business owner, even if he ends up bankrupt. Unemployment also keeps the supply of labor at a fairly constant rate. Say I worked for one of this business owner's competitors, who went out business, and have a mortgage. To make ends meet, I immediately take a job in an unrelated field. Now, that business cannot hire me because I've stopped looking for a job. (I know, i'm simplifying here, bear with me.) Unemployment lets me spend more time on the market, looking for offers in my field. Sort of like FDR's Treasury Secretary said about the New Deal. "People don't eat over the long term. They eat everyday."

astine 18y ago

Capital spending, contributes just as much to the economy as consumer spending. More so in fact, as capital can be used to produce more goods an consumer goods cannot. This fellow spends a hell of a lot more than most of us, and on goods which will contribute to the economy in more substantial ways than anyone purchasing a television would. --- That said, I totally disagree with the tone of the letter, which betrays a level of pride and arrogance. The fact that he's threatening his employees rather than attempting to earn their loyalty, says a lot about the man.

redrobot5050 18y ago
But consumer spending is easy to stimulate. Just give consumers more money to spend. Economists still argue what works best to stimulate businesses. There's no one right way to do it. Some believe in deregulation. Some believe in low business taxes. Some believe in business-ownership tax incentives. Some think lax credit laws or "high liquid markets" make it happen. Others, like the letter writer, believe in trickle down and low taxes for business. An aside, anyone with a functioning brain that lived through the Reagan era knows this to be a complete falsehood. Second, its been observed (again, this is like some people say, so take with a grain of salt) that many pro-low tax people cannot control their lifestyle spending. Therefore, the only way to increase their ability to repay on their debt/save money is to reduce their tax burden. I've worked for a small business owner like this. They're small minded and arrogant beyond belief. They don't respect the people who work for them. "Penny smart, but pound foolish" as the expression went. He was sure to talk to us, off company time, in 2004 to remind us how dangerous it would be to vote for John Kerry because of his plan to force businesses to offer health care. At the time, none of us working there had health care, except the owner. He had a private policy which he could afford because he paid himself such a high salary. We would make $20/hr (with no benefits) and he would pocket $60/hr from our labors. He was eventually forced to offer health care anyway, once most of his top employees (and me!) left to companies that provided benefits and didn't treat you like cattle.