At a Massachusetts political rally, Hillary Clinton (likely first in line to succeed Barack Obama as President), said the following:
“Don’t let anybody tell you it’s corporations and businesses that create jobs. You know, that old theory ‘trickle-down economics.’ That has been tried, that has failed, it has failed rather spectacularly.”
See the video for yourself:
If corporations and businesses (large and small) don’t create jobs, then who does?
If a small business opens in your town, and the business posts a sign saying, “Help Wanted,” then who is responsible for this? There’s no government mandate or law requiring the business to offer a job. There’s no official in the state’s or nation’s capital issuing a decree saying, “There shall be a certain number of jobs in this location.” That may be a Communist, socialist or progressive fantasy, but it’s not how business works.
The creation of a job is set into motion by the energy, will, determination and choices of the person who owns the company, or who operates the portion of the company offering the jobs.
It’s also set into motion by the business owner’s willingness to take a risk. If the business fails, the job will go away and this certainly represents a loss for the employee. But it’s an even greater loss for the business owner. The business owner whose business does not work out must pay the cost in terms of lost revenue and debt. Government will not do anything for the business owner. In free enterprise particularly, businesses take risks and reap the rewards — sometimes millions or billions — but they also take the risk of loss.
We never hear about the loss or risk side of the equation, especially from highly visible political hacks like Hillary Clinton. We only hear about how selfish, greedy, stingy, insensitive and (of course) racist the person who makes a lot of money is. Not everyone buys this attitude, at least not fully. But the majority of us — not just in Massachusetts, but in America more generally — keep electing people who do hold this attitude firmly, consistently and mean to implement it.
In her statement, Hillary Clinton doesn’t necessarily say who does create jobs. She merely denies that the private sector does. The implication is — obviously — that the government does. In the video, she talks about how the minimum wage not only doesn’t destroy jobs but it actually creates them. How in the world is this possible? How does a government mandate, which interferes in the market — that is to say, interferes in the interactions and negotiations between an employer and employee — actually create anything?
The most you can claim is that a government edict or rule does no damage. And this claim is highly debatable, even fallacious. If an employer judges a job worth a certain amount in labor costs, no government mandate can make the job more worthwhile than it previously was. A government law can force an employer or a business to actually pay more, but it cannot make an employer want the job more than it’s economically worth. And it’s simply self-evident that when government imposes additional costs on a business that the business could not otherwise afford, the business either (1) goes out of business, or (2) passes on those costs to the customer by raising prices for the goods and services delivered.
Hillary Clinton has gone a step further than most politicians in her statements. She’s not merely saying that government regulations have no impact. She’s actually claiming that they generate economic growth.
People like her love to use the phrase, “trickle-down economics.” This is their way of mocking the fact that without capital, there is no capitalism. Without money to invest, and without profit being made in the production of goods and services, there is no economic growth. Economic growth is, by definition, the result of businesses doing the things that profit-making businesses do; and of which politicians are generally very critical, once those businesses are successful, at least.
People who support capitalism — or even the mealy-mouthed Republicans who claim to favor capitalism — are constantly on the defensive. They constantly seek to apologize, excuse or explain away their support of “trickle-down” economics.
Capitalism — the real kind of America’s first century, not the watered-down and government-managed and manipulated kind of today — brought about the greatest rise in the standard of living in all of human history. It generated wealth and profits, but it also generated an inventive era and mindset of continued improvement from one generation to the next whose remnants and expectations are still with us today. The government did not contribute to this, other than by protecting individual and property rights to the extent that it has. But at the end of the day, it’s always an independent thinker, mover and shaker who gets everything rolling. Even if government could do this, it would still depend on the (tax) money generated by that mover and shaker in order to accomplish anything. Clinton’s comments reveal a brutal and even willful ignorance about basic economic facts of reality.
Just once, I’d love to see such people, especially the ones running for public office, be on the defensive. I’d love to see them asked, “If the private sector does not create jobs, wealth and economic growth — then who does?”
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