Letter: The Key to Job Expansion
To the Editor:
“Most Americans intuitively understand that raising taxes on small business is costing them jobs,” U.S. Rep. Tom Cole, R-Okla., was quoted as saying in an article in the Nov. 29 Valley News. Unfortunately, intuition does not always reflect reality, and this Republican claim has little evidence to back it up.
In a market economy, businesses will hire more workers when there is demand for more of their goods and services. If there is no demand, any excess liquidity will most likely be set aside as a reserve for a rainy day. Market demand is increased when more customers can afford to pay for products, and the concentration of income into fewer hands that we have seen for decades is simply counterproductive.
At the end of the Clinton administration, the U.S. economy was running a surplus, and the national debt was being paid down. Tax rates were higher than they are now, and unemployment was lower. Since then, the rich have gained an ever increasing share of the available income, and it is hard to argue that the economy has become healthier. It is time to start improving the purchasing power of the market. Bribing employers to hire more workers will not work until the market improves.