Employment advice for Obama
President Obama brainstormed at the White House Wednesday at a forum on “insourcing American jobs.” The administration’s greatest political vulnerability is sky-high unemployment. The basic idea that trickled out of the session was America must “bring back” jobs from overseas by raising taxes on companies that invest abroad. That’s a bad idea.
The president’s economic advisers think they can wave their legislative wands to make bad news disappear. They give no thought to the consequences of having bureaucrats select winners and losers in the market. They don’t consider the downside of layering more red tape around an already complex tax system. If Mr. Obama were serious about bringing down the unemployment rate from its current 8.5 percent level, he would work on reducing the regulatory and tax burden so industry could spend more time creating wealth and less filling out paperwork. Mr. Obama’s selective tax incentives will be as useless as his Keynesian stimulus spending binge that left the country a trillion dollars poorer.
The left refuses to move away from the tired, discredited ideas of the British economist who inspired FDR and Jimmy Carter. Contrary to the main premise of Mr. Obama’s forum, jobs aren’t something bureaucrats can “bring back.” A market system is dynamic; the number of jobs isn’t fixed. Investment shouldn’t be made to go backward toward typewriters and horse-driven carriages, having moved to cloud computing and automobiles. When government attempts to create jobs or redirect the market, it fails. Government isn’t the channel for job creation – the private sector is.