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Krauthammer: If you subsidize apples, you get more apples. If you subsidize unemployment…
Hotair ^ | 01/07/2014 | Erika Johnsen

Posted on 01/07/2014 12:50:23 PM PST by SeekAndFind

It seems to be a truth only very selectively acknowledged that, when you tax something, you’ll end up with less of it (the corollary being that, if you subsidize something, you’ll get more of it). Progressives seem perfectly capable of recognizing this truth in the context of sin taxes and green-energy subsidies, yet when it comes to things like the extension of unemployment benefits that is making its way through the Senate at the moment, they seem to think that such policies are immune from the most basic of economics. That’s the point that Charles Krauthammer made last night, pointing out that the White House and the Democrats are touting the full-blown awesomeness of their ongoing economic “recovery” and the accompanying job creation out of one side of their mouths while grandstanding about the need for further unemployment benefits out of the other — but the reality is that today’s unemployment rate of around seven percent actually looks a lot more like eleven percent if you use the same labor force participation rate of just a few years ago, and the Democrats keep approaching the systemic problem with the same old-and-tired non-solutions that are practically good for little else than browbeating Republicans. Via RCP:

CLICK ABOVE LINK FOR THE VIDEO

The core issue is creating an entitlement. This has never been considered an entitlement. And you go down this road, Sperling says now is not the time. Four and a half years into a recovery, at least as defined by the administration itself, is not the time? If not now, then when? I mean, what we’re going to end up with is an European level of unemployment, chronic unemployment subsidized. And the fact is, if you subsidize apples, you get more apples; if you subsidize unemployment, you get more of it. And that’s what the economics study shows. It’s not that people are lazy. It shows that if you have unemployment insurance, then you can make choices which would allow you to turn down a job that perhaps isn’t exactly what you want. The vast majority of the unemployed want a job, and the problem is the state of the economy.



TOPICS: Business/Economy; Culture/Society; Government; News/Current Events
KEYWORDS: jobs; krauthammer; unemployment

1 posted on 01/07/2014 12:50:23 PM PST by SeekAndFind
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To: SeekAndFind

If you subsidize imports, you get more imports and more unemployment.


2 posted on 01/07/2014 12:55:26 PM PST by DannyTN (A>)
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To: DannyTN

How are we subsidizing imports?


3 posted on 01/07/2014 12:56:36 PM PST by SeekAndFind
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To: SeekAndFind

We’re not charging tariffs equal to the tax and regulatory burden on domestic employers.


4 posted on 01/07/2014 12:58:29 PM PST by DannyTN (A>)
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To: SeekAndFind
"How are we subsidizing imports?"

American workers and their employers pay SS taxes. Imports don't.

5 posted on 01/07/2014 1:01:22 PM PST by ex-snook (God is Love)
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To: DannyTN

RE: We’re not charging tariffs equal to the tax and regulatory burden on domestic employers.

So, NOT Taxing something is equivalent to subsidizing it?


6 posted on 01/07/2014 1:02:01 PM PST by SeekAndFind
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To: ex-snook

RE: American workers and their employers pay SS taxes. Imports don’t.

So, the solution is to make the goods that American consumers buy more expensive and give government bureaucrats more money?

I thought we all wanted smaller government?


7 posted on 01/07/2014 1:04:02 PM PST by SeekAndFind
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To: SeekAndFind
So, NOT Taxing something is equivalent to subsidizing it?

When American goods are subject to extra taxes in China simply because they're American products, whereas Chinese products are not subject to the same, reciprocal taxes here in the U.S. -- I'd say that's subsidizing Chinese products.

What would you call it?

8 posted on 01/07/2014 1:04:03 PM PST by usconservative (When The Ballot Box No Longer Counts, The Ammunition Box Does. (What's In Your Ammo Box?))
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To: SeekAndFind

This article reveals the problem. Conservatives discuss issues in elevated and intelligent theses and articles. Friedman, Sowell, Williams, Hayek, Smith.

Collectivists discuss issues simply. “Want a free phone? Here. Want some free food? Here you go. Want some free health care? Here. Republicans ain’t gonna give you free sh—, yo.”

Now who’s going to win that discussion?


9 posted on 01/07/2014 1:04:07 PM PST by lurk
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To: SeekAndFind
I thought we all wanted smaller government?

We do. We all also want FAIR trade. Not FREE trade which skews in favor of other nations at the expense of American workers.

Is there a reason in your eyes why we cannot have both smaller government and fair trade? We can if we go back to the system our founding fathers intended -- which was funding the government via import and excise taxes rather than punitive income taxes.

10 posted on 01/07/2014 1:06:41 PM PST by usconservative (When The Ballot Box No Longer Counts, The Ammunition Box Does. (What's In Your Ammo Box?))
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To: usconservative

Let’s first ask ourselves why goods are made in China and not here....

Let’s count the ways:

-The minimun wage
-Unions
-Sick Leave
-Paid Holidays
-Family Leave
-ADA
-OSHA
-EPA
-Permit process
-EEOC
-Affirmative Action
-Employer based Daycare
-Employer paid Heathcare
-Employer paid defined retirement plan
-Employee Law Suits

So, the solution is to TAX the Chinese goods the equivalent of all the above costs so that we can level the playing field?

And how much will the things in Wal-Mart cost?


11 posted on 01/07/2014 1:07:49 PM PST by SeekAndFind
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To: SeekAndFind

It’s time to understand that liberals simply do what they’re told and don’t care about hypocrisy, While Leftists do understand economics and are methodically destroying the country while hiding behind liberal ignorance - which isn’t really ignorance, but rather the hip hip hypocrisy of deliberately selected codependent moral cowardice.


12 posted on 01/07/2014 1:08:01 PM PST by Talisker (One who commands, must obey.)
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To: lurk
Now who’s going to win that discussion?

The incompetent, inept, economically stupid jackwagon currently sitting in the White House. That's who.

13 posted on 01/07/2014 1:08:17 PM PST by usconservative (When The Ballot Box No Longer Counts, The Ammunition Box Does. (What's In Your Ammo Box?))
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To: usconservative

RE: funding the government via import and excise taxes rather than punitive income taxes.

Well, I’ll go there provided we eliminate these government mandated cost on American business that forces companies to make things in China:

-The minimun wage
-Unions
-Sick Leave
-Paid Holidays
-Family Leave
-ADA
-OSHA
-EPA
-Permit process
-EEOC
-Affirmative Action
-Employer based Daycare
-Employer paid Heathcare
-Employer paid defined retirement plan
-Employee Law Suits

If we can’t, all these talk is just academic.


14 posted on 01/07/2014 1:09:30 PM PST by SeekAndFind
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To: SeekAndFind

Whatever you subsidize you get more of.
Whatever you tax you get less of...................


15 posted on 01/07/2014 1:10:04 PM PST by Red Badger (Proud member of the Zeta Omicron Tau Fraternity since 2004...................)
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To: SeekAndFind

POSHITUS slipped up big time in his address today: he said we should be even more sympathetic to the 99ers because employers probably won’t hire people who have been out of work so long.

It immediately broke his rhythm when he said it, and he was shaky for the next five minutes.

His prose after the employer comment was like ‘did I just really say that?’


16 posted on 01/07/2014 1:10:49 PM PST by txhurl
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To: Red Badger

RE: Whatever you tax you get less of...................

So what happens to the goods most Americans buy in Wal-Mart when we tax the hell out of imports?


17 posted on 01/07/2014 1:11:54 PM PST by SeekAndFind
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To: SeekAndFind

We can’t tax imports like we should due to WTC rules..............


18 posted on 01/07/2014 1:13:31 PM PST by Red Badger (Proud member of the Zeta Omicron Tau Fraternity since 2004...................)
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To: txhurl

I’m surprised he didn’t follow it up with, “....so to give potential employers more candidates, we need to pass comprehensive immigration reform as soon as possible....”.


19 posted on 01/07/2014 1:14:13 PM PST by NEMDF
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To: SeekAndFind

Since the inception of establishing a “minimum wage” the very basic coin of the realm,the cent, has become valueless. Todays penny costs more to make than its assigned value. Even Canada stopped making them.

Yet this is not an argument for abolishing the coin itself. But to point out when a minimum wage is raised it affixes a given rate of inflation to the period of time it’s emplaced. All raising the minimum wage does actually is devalue the dollar because costs get adjusted in time to compensate to the increase.

A case in point is in the 1940’s a candy bar cost 5 cents when the hourly minimum wage was $.50 per hour. What does it cost today ? Likewise what were the costs of basic goods and services during that period of time as compared with todays basic wage feel good tinkering ?

Who gets hurt the worst when these adjustments are decreed by government? It’s those living on fixed incomes who’s income value is based on previous minimum wage levels but not adjusted to the previous current rates of inflation.

When these feel good socialists frauds under the democrat party banner propose these increases. That is never considered as they pound their breasts claiming they’re for the little guy. All they’re doing is un-necessarily raising the price on goods and services broadening the demand that those affected seek help from them.


20 posted on 01/07/2014 1:14:48 PM PST by mosesdapoet (Serious contribution pause.Please continue onto meaningless venting no one reads.)
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To: SeekAndFind
So, the solution is to TAX the Chinese goods the equivalent of all the above costs so that we can level the playing field?

First, your list is way too short.

Second, your post assumes that should the United States of America, who happens to be China's biggest customer, implement the same import/excise taxes on Chinese goods that the Chinese impose on American goods, that the Chinese wouldn't back down and drop/eliminate their taxes on American made goods going into China.

My bet is they would, and that would make your argument moot. That's hypothetical of course. Frankly, I think the United States should have reciprocal trade agreements -- meaning any country who wants to sell in the US gets receives the same treatment for their products coming INTO our country as our products get going into theirs.

That would change our trade deficit in a big hurry and put a lot of American's back to work.

21 posted on 01/07/2014 1:15:10 PM PST by usconservative (When The Ballot Box No Longer Counts, The Ammunition Box Does. (What's In Your Ammo Box?))
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To: SeekAndFind
"So, NOT Taxing something is equivalent to subsidizing it?"

Yes, they should be taxed equally. If you tax domestic producers more than you tax foreign producers, you are effectively subsidizing foreign producers.

It's a subsidy because foreign producers aren't paying their fair share of supporting the government which protects the American market and enforces the rules of the American market.

22 posted on 01/07/2014 1:15:51 PM PST by DannyTN (A>)
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To: SeekAndFind
"So, NOT Taxing something is equivalent to subsidizing it?"

Yes, they should be taxed equally. If you tax domestic producers more than you tax foreign producers, you are effectively subsidizing foreign producers.

It's a subsidy because foreign producers aren't paying their fair share of supporting the government which protects the American market and enforces the rules of the American market.

23 posted on 01/07/2014 1:15:52 PM PST by DannyTN (A>)
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To: SeekAndFind
So what happens to the goods most Americans buy in Wal-Mart when we tax the hell out of imports?

American made products step in and fill the void. You already knew that.

24 posted on 01/07/2014 1:16:20 PM PST by usconservative (When The Ballot Box No Longer Counts, The Ammunition Box Does. (What's In Your Ammo Box?))
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To: DannyTN

Post of the day. Wish I could’ve said it that succinctly!


25 posted on 01/07/2014 1:17:06 PM PST by usconservative (When The Ballot Box No Longer Counts, The Ammunition Box Does. (What's In Your Ammo Box?))
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To: Red Badger
"We can’t tax imports like we should due to WTC rules.............."

I think you mean WTO. We need to get out of the WTO.

26 posted on 01/07/2014 1:17:54 PM PST by DannyTN (A>)
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To: Red Badger
"We can’t tax imports like we should due to WTC rules.............."

I think you mean WTO. We need to get out of the WTO.

27 posted on 01/07/2014 1:17:55 PM PST by DannyTN (A>)
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To: SeekAndFind

The SS solution is to tax foreigdners the same as Americans. This has nothing to do with the size of Government, it’s SS to Americans.


28 posted on 01/07/2014 1:24:44 PM PST by ex-snook (God is Love)
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To: usconservative

RE: American made products step in and fill the void. You already knew that.

Sure, as long as you don’t mind paying more for your products and immunize some shoddy American competitors from the competition and give no incentive to better their own goods while keeping all of the stifling regulations in place.

And also, as long as you don’t mind Retaliatory measures from the countries we tax imports on.


29 posted on 01/07/2014 1:40:28 PM PST by SeekAndFind
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To: DannyTN

RE: If you tax domestic producers more than you tax foreign producers, you are effectively subsidizing foreign producers.

So, why not tax domestic producers LESS so that they in effect are level with foreign producers?

For instance, our corporate taxes are 35%, the HIGHEST in the developed world. Canada’s is just 15%. Why not DROP our corporate taxes to 15% instead?


30 posted on 01/07/2014 1:44:17 PM PST by SeekAndFind
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To: DannyTN

Yes, WTO, but maybe the World Trade Center as well............:^0


31 posted on 01/07/2014 2:05:25 PM PST by Red Badger (Proud member of the Zeta Omicron Tau Fraternity since 2004...................)
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To: SeekAndFind
And also, as long as you don’t mind Retaliatory measures from the countries we tax imports on.

Again, reciprocal trade agreements: the deal you give us, is the deal we give you. How could/would another country retaliate against the U.S. for giving them the same deal we gave them? Seems kind of nonsensical to me.

Sure, as long as you don’t mind paying more for your products and immunize some shoddy American competitors from the competition and give no incentive to better their own goods while keeping all of the stifling regulations in place.

What stifling regulations? If anything my method would eliminate many of those regulations and free American manufacturers to produce product through fair competition. That's exactly why our Founding Fathers said, and funded our government initially with import and excise taxes.

What you seem to be forgetting is that in a fair market, the consumer decides. If American companies produced shoddy products going forward as you believe they will, then the American Consumer will decide and drive the market in another direction. Gee, we haven't seen THAT before have we? Oh, YES WE HAVE! Remember the SHODDY American cars of the 70's and 80's? Why don't we have those SHODDY cars anymore? COMPETITION. Toyota and Honda for example entered our marketplace, built better products, listened to consumers and gained market share.

The fact is, I think you and I have benefitted much from that competition. How so? Frankly, it's really hard to buy a really crappy new car these days isn't it? I remember the days where one was lucky that their car lasted as long as their automobile loan (48 months) and were lucky to get a few hundered bucks on their trade-ins. We have a vastly different scenario today with the average car on the road being between 10-11 years old, having over 100,000 miles on it and still running well. In fact American cars have gotten so good they're re-gaining market share from the foreign imports.

The bottom line is this: I'd *happily* support American made products in a fair market where American made products compete on the same level playing field as the products that are imported here on a daily basis. I suspect most Americans independent of their political ideology feel the same way.

I believe in the American worker. Apparently you do not.

32 posted on 01/07/2014 2:08:21 PM PST by usconservative (When The Ballot Box No Longer Counts, The Ammunition Box Does. (What's In Your Ammo Box?))
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To: usconservative

RE: What stifling regulations?

I just listed some of them above.

-The minimun wage
-Unions
-Sick Leave
-Paid Holidays
-Family Leave
-ADA
-OSHA
-EPA
-Permit process
-EEOC
-Affirmative Action
-Employer based Daycare
-Employer paid Heathcare
-Employer paid defined retirement plan
-Employee Law Suits

How would imposing taxes on foreign goods suddenly make all of the above disappear?

The proper response to Chinese success is not an attempt to artificially restrict their competitiveness but to stop putting balls and chain on the ankles of businesses here. The US isn’t such an enormous share of the markets anymore than we are immune to market upheavals around the world and a necessity for their sellers.


33 posted on 01/07/2014 2:13:05 PM PST by SeekAndFind
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To: DannyTN

Dittos! That was my exact thought as well.


34 posted on 01/07/2014 2:14:30 PM PST by CodeToad (When ignorance rules a person's decision they are resorting to superstition.)
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To: Red Badger

I think we’re successfully out of the WTC, not that it was our choice. If only they had hit the WTO instead.


35 posted on 01/07/2014 2:17:19 PM PST by DannyTN (A>)
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To: SeekAndFind; usconservative
For the most part, those regulations are only stifling if you allow foreign competition to compete without corresponding regulations or an offsetting tariff.

We should NOT seek to be the most deregulated economy or we'll end up like China with polution or Somalia. But to be highly regulated and then let foreign competition compete with little or no tariffs is not wise.

However, you could eliminate all U.S. Regulation and taxes and you still can't compete against communist China's labor rates. The wage differential trumps the cost of regulation big time.

We shouldn't try to compete against them. We should limit their access to our market. And take advantage of their low priced labor only when we are at full employment and only with regard to low value industries and jobs.

36 posted on 01/07/2014 2:28:05 PM PST by DannyTN (A>)
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To: SeekAndFind

Government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.

Ronald Reagan


37 posted on 01/07/2014 2:30:36 PM PST by Uncle Miltie (Mohammed was a pedophile and Islam is a Totalitarian Death Cult.)
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To: DannyTN

That’s an oxymoron. We impose stupid wasteful regulations on our businesses so we should raise tariffs.

The answer is not to make everything we buy more expensive, it’s to repeal all the stupid wasteful regulations.


38 posted on 01/07/2014 2:32:12 PM PST by DManA
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To: DManA
Not all of those regulations are wasteful.

And I'll repeat. It's the wage differential, not the regulations. You can eliminate all of the regulations and we still can't compete with Chinese labor rates.

We shouldn't let foreign countries dictate what our wages are or what our regulations should be. It's our market and we don't need them.

Our founding fathers warned us against entanglements with foreign countries. When imports are equivalent to 16% of our GNP, that's an entanglement.

Our founding fathers thought tariffs on imported goods was an "external" taxation that maximized the freedom of U.S. citizens by avoiding direct taxation of our citizens.

We should raise the Import tariffs and drop the individual income tax by a corresponding amount. A 10% import tariff would allow a $1500 per worker tax decrease in individual income taxes.

Not only would we have industry returning to America due to the tariff, but we would have more Americans keeping more of their money to spend as they please.

39 posted on 01/07/2014 2:38:20 PM PST by DannyTN (A>)
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To: DannyTN

Uh uh. We’ll all just pay more for everything.


40 posted on 01/07/2014 3:02:14 PM PST by DManA
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To: DManA
"Uh uh. We’ll all just pay more for everything."

Imports will cost a little more, but we will be making a lot more money and keeping a lot more money. There will be a 30% increase in the American workforce if we put the unemployed back to work (23%/77% = 30%). The offsetting individual income tax = $1500, which will pay for the increased cost of the imports.

But because 30% more Americans will be working, businesses will see volumes rise. Most of that money will be spent here.

Government would initially be revenue neutral as the decrease in income taxes offset the new tariff revenues. But then as people went back to work, gov't would see a huge increase in income tax receipts. And gov't would be paying out less for the unemployed. It's a win win, and it's the way to fix our budget problems and get out of debt.

41 posted on 01/07/2014 3:29:13 PM PST by DannyTN (A>)
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To: DManA
"Uh uh. We’ll all just pay more for everything."

Imports will cost a little more, but we will be making a lot more money and keeping a lot more money. There will be a 30% increase in the American workforce if we put the unemployed back to work (23%/77% = 30%). The offsetting individual income tax = $1500, which will pay for the increased cost of the imports.

But because 30% more Americans will be working, businesses will see volumes rise. Most of that money will be spent here.

Government would initially be revenue neutral as the decrease in income taxes offset the new tariff revenues. But then as people went back to work, gov't would see a huge increase in income tax receipts. And gov't would be paying out less for the unemployed. It's a win win, and it's the way to fix our budget problems and get out of debt.

42 posted on 01/07/2014 3:29:13 PM PST by DannyTN (A>)
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To: SeekAndFind

If you subsidize unemployment you get more democrat voters. If you subsidize poverty you get more democrat voters. If you subsidize failure you get more democrat voters. If you subsidize perverts you get more democrat voters. If you subsidize crime you get more democrat voters.

It’s as simple as that.


43 posted on 01/07/2014 4:34:49 PM PST by Organic Panic
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To: SeekAndFind

I think that the records show most people on unemployment get a job about two weeks before their benefits run out. Which means they hold out as long as possible before taking maybe a job not as great as the one they lost.

We now have unemployment out to 2 years Like Newt said thats an AA degree.


44 posted on 01/07/2014 5:17:33 PM PST by Georgia Girl 2 (The only purpose of a pistol is to fight your way back to the rifle you should never have dropped.)
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To: SeekAndFind

Hahahahahahahaha....


45 posted on 01/08/2014 7:44:29 AM PST by Lee'sGhost (Johnny Rico picked the wrong girl!)
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