By: Jeffrey Klein, Political Buzz Examiner
Falling under the heading of much too little and way too late, the big news from the White House today is that President Barack Obama will soon float changes to the corporate income tax laws, in the hope to change U.S. companies’ behavior from outsourcing jobs to low labor rate countries like India and China.
“In the coming weeks, the president will put forward new tax proposals to reward companies that choose to invest or bring back jobs to the United States, and to eliminate tax advantages for companies moving jobs overseas,” the White House said in a statement, as reported by Reuters today.
Now, three years after his inauguration, President Obama believes that he can punch through modifications to the most complicated tax code on Earth, to result in a profound affect on the stagnant, high unemployment rate–before November 6, 2012.
Unfortunately, even if these tax code changes could be legislated and implemented before Election Day–Obama is playing to the wrong audience for two reasons.
First, large multinational corporation’s plans for 2012 have already been solidified.
But, more importantly, small businesses are well known to be the quickest and largest source of new jobs; however, in contrast to Obama’s plan, their income is typically taxed at the personal level, because they use LLCs and Sub-Chapter S Corporations for their businesses–as a result, they will find no hiring incentive whatsoever.
This is obviously another “high concept” idea, conjured up by Obama, and his ever-changing inner circle of advisors, who are equally unfamiliar with how private sector job growth occurs.
Small businesses do not create new jobs as a result of “tax incentives,” but as they need them to accommodate increased sales, which the U.S. economy has not seen in a long time.
President Obama has created another problem for himself, particularly in the small business community–his very public class warfare rhetoric, pro-union and anti-business stance and Obamacare, have all accumulated to “freeze” nearly all business owners in their tracks.
Small business people have [their] “skin in the game,” and know if they make [enough] wrong decisions, they can lose everything they have. This is a “foreign concept” to Barack Obama, because he has always been an employee in the public sector–without any knowledge or experience of how a business operates, and has no understanding about the anxiety of the daily responsibilities that go along with it.
Obama knows nothing about risking his own capital, or mortgaging his family home, to start a company; he knows nothing about hiring employees whose bi-weekly paychecks are his personal responsibility to fund–never mind having the expensive headache of compliance with a growing avalanche of resource-gobbling government regulations, and a litany of profit-killing taxes.
Finally, there is Obama’s seemingly lawless, capricious and divisive partisan behavior, driven by what some would label as a combination of narcissism, liberally sprinkled with schizophrenia from one week to the next, which has created an atmosphere of absolute distrust among businesses.
For example, his recent [illegal] “recess appointments,” when the Senate was in [legal] pro forma session; his fleeing aboard Air Force One, when leadership was the prescription on the eve of important legislation; his inability to retain key advisors in the White House and West Wing; and, the unequalled domestic economic disaster that has fomented under his presidency.
If President Obama couldn’t do better than eek out a “two-month” extension on two pre-existing programs (payroll tax holiday and long term unemployment benefits), during the last three weeks of the year–then how in the world does he expect to get a meaningful corporate tax code deal done in time for it to have any effect on unemployment?
The answer is: He doesn’t expect it to work.
This is simply a plot to add another failure to the “do nothing Congress” defense he has been fabricating–in a desperate attempt to “explain” his complete failure as President of the United States.
Copyright (c) 2012 by Jeffrey Klein