Not Another Jobs Bill: The Real Implications of Obama’s Plan


Some days, I hate reading the news. The other day, it was all about Obama and jobs-yet again. Obama’s new proposal faced a critical vote in the Senate; even though the bill was rejected by Senate Republicans, it’s still going to be conentious as Democrats seek to split the bill into sections to try to pass it piecemeal.  Of course, as a political nerd, this kind of thing really interests me, so why not add a little political theory to it and make a post out of it? Before I go on you might want to take a look at the article, which is available here. I’ve also included a more updated analysis to clarify the bill’s political implications slightly. Beyond the money and unemployment statistics comes an important realization for the United States as a whole: bills such as these represent a fundamentally different style of American government than the one that the founding fathers envisioned.

President Obama, flanked by Speaker Boehner and Vice President Biden, prepares to deliver his 2011 State of the Union address.

Anyone on either side of the argument can find numbers and statistics to support their stance, and since I’m not really trying to argue economics here, I’ll largely leave that out of the equation. The issue seems to be primarily about philosophy: should the government attempt to “spread the wealth” around a bit, or should we all be allowed to keep what we make and maintain a smaller, less imposing government? I (and, most likely, our nation’s creators) endorse the latter. Contrary to a modern view of America, the founding fathers had in mind a very limited government that would do little more than ensure the protection of rights for all citizens. They sought to ensure liberty through an equal, just, concise, and well-written Constitution. Thomas Jefferson himself remarked that “a wise and frugal government, which shall leave men free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned – this is the sum of good government.”

Thomas Jefferson, one of America's founding fathers and an ardent supporter of limited government.

As this quote shows, Jefferson desired a conservative United States. As many of the founding fathers shared his views, America was a nation fundamentally founded on conservative principles in spite of the lack of an aristocracy. Take income tax, for example, one of the most contentious political issues today. The US never had a federal income tax until the Revenue Act of 1861, and not until the 16th Amendment in 1913 was an income tax officially regulated in the Constitution. It seems hard to believe that given our anti-tax, small government roots, America today has a corporate income tax rate of 35%-second in the world only to Japan at 39.5%-and a top income tax rate set at 35% as well.While there are certainly tax loopholes that (fortunately) prevent these numbers being realized in both systems, the underlying principle is that the US government has attempted to tax our citizens and corporations at one of the highest rates in the world. This decision goes against everything that America was founded upon because it encourages a strong, centralized government.

So why is this so fundamentally bad? After all, doesn’t that money go to help people? Such a system is bad for America because it does not foster the competitive attitude and pro-individual intentions of the founding fathers. Beyond the obvious American politics implications, this isn’t about reviving the economy or helping any one group more than another group; it’s about maintaining a nation that has one of the longest surviving Constitutions in the world and encouraging individualized competition-the hallmarks of a successful America that the authors of our Constitution set forward way back in 1787.

I love the idea of helping everyone out, but giving to the needy should be a very personal choice, not something imposed through taxation and economic interference by the government. If people want to set up food banks, soup kitchens, or local poverty programs, more power to them. Jefferson would likely agree; after all, America was built on freedom of the will and personal choice, so  if our citizens want to choose to do that, let them. To have an executive body step in, take the money, stifle the competitive spirit, and make decisions for us that we should really be making ourselves does not serve to perpetuate the principles that made America great in the first place. While Obama’s plan may or may not actually help the economy, it most certainly does subvert America’s biggest promise to the world and to its citizens: freedom from interference and the ability of citizens to make their own dreams a reality.

Karl Marx, author of "The Communist Manifesto" and a key inspiration for revolutionaries such as Lenin and Castro.

Hobbes might say that US citizens should just go along with it; after all, if the government says it is to be, then why shouldn’t it? Karl Marx, the author of  The Communist Manifesto and a supporter of a proletariat revolution would probably agree with Obama’s decision because doing so would empower the working classes. As Marx saw it, capitalism was a necessary step in an unstoppable advancement of history towards empowerment of the proletariat, culminating with the overthrow of the bourgeois social order. On the other hand, America’s founding fathers-men like Washington and Jefferson-would emphatically oppose such tax hikes, citing that they do not properly reward those who make a lot of money and fail to create a competitive atmosphere.

What Obama’s plan does economically is important, but for my purposes, the interesting part is how the passage of such bills alters the American experience with the free market. What do you think? Should America turn back to its conservative roots, or is it time to push ahead on a new path? Is Jefferson still relevant today, or is Marx’s time to shine upon us?

Advertisements

Subscribe

Subscribe to our RSS feed and social profiles to receive updates.

13 Comments on “Not Another Jobs Bill: The Real Implications of Obama’s Plan”

  1. srbarron Says:

    You made very valid points about Obama and fellow democrats continually trying to pass almost socialist bills. Our country was founded to be a democratic free market capitalist country. However, it seems that with the Democrats controlling the Senate and the executive branch, our country is veering away from its genuine purpose of being a country where everyone can achieve the American Dream on their own if they work hard enough. Norman Thomas, a six time presidential candidate for the socialist party explains our country’s journey towards socialism as follows: “The American people will never knowingly adopt socialism, but under the name of liberalism they will adopt every fragment of the socialist program until one day America will be a socialist nation without ever knowing what happened.” As pointed out above, America is on it’s way to becoming more and more like socialist Russia, yet our government won’t accept it.

    Having similar political views to those represented in this post, I fear that our country is headed in the wrong direction. The wealthy are loosing their desire to invest and create new markets as their monetary successes are being given to the government in the form of taxes to invest in programs that have not proven to be successful. I agree that it is great to help the lower class succeed, but this should be done through programs that advance the community and encourage people to seek employment and make economic gains on their own.

    I think that without a front-runner candidate for the Republican Party, the trend towards socialism will continue. Will Obama continue his trend, or will a divided government stop his policies? Will he even change his polices to be more centered and concede a bit to the Republicans in Congress?

    • ianbaker2041 Says:

      I think you’re touching on some really important issues about American politics. The fact that both parties just go back and forth without clear, firm leadership from either one means that with each new piece of liberal legislation, the US moves closer to the socialist country that you and I both want to avoid. This is the fundamentally wrong thing for America to do given our history, as I talk about in the post.

  2. guysnick Says:

    I enjoyed reading this post. It brings up several relevant, and also quite controversial, issues facing the United States today. I also personally agree with the political stance taken in this post. America was founded on primarily conservative principles, and I believe that it is, unfortunately, steadily falling away from such principles today. Unemployment is still preposterously high, the economy is still struggling, the American military is still involved in far too many overseas conflicts, and the national debt is through the roof. I hope that things will begin to finally make a turn for the better following the 2012 elections, but that remains to be seen.

    One of the first ideas brought up in the post was the aspect of the United States’ high income and corporate tax rates. While moderate taxes are certainly necessary for both individuals and businesses, and taxation should increase proportionately as income increases, I would agree that higher and higher taxes on the American upper class are definitely not the answer for solving the economic and debt problem. It is absurd that the the wealthiest 5% in this country pay nearly 60% of all taxes, while the bottom 50% pays only 2.7% of taxes, according to the National Taxpayers Union. Higher taxes on the rich, who are also the largest spenders – and thus contribute most to the economy – are not going to jump start the economy or fix the national debt. This is only going to be accomplished by reduced spending. President Obama and his administration need to make cuts, whether that is in the military, Medicare and Medicaid, or other government programs. And something has to be done soon.

    Finally, I do think it is important for America to turn back to its conservative roots, and I hope this will commence with the election of a Republican president in 2012. It is definitely not the time for the United States to shift toward Marxist principles. I do not think it is fair to say that Obama is trying create a socialist U.S., but socialism is definitely not the answer to America’s economic woes. The U.S. needs to maintain its capitalistic ideals while at the same time exercising much more efficient spending and responsible political decisions.

    • Brian Hall Says:

      Considering that the top 5% of the population owns 72% of the financial wealth, and the bottom 80% of the population owns only 7%, the taxes on the rich are proportionally too low. (Source: http://sociology.ucsc.edu/whorulesamerica/power/wealth.html). Also consider that the people in that top 5% are not actually doing work (and therefore not really contributing to society), they are simply taking risks with capital they already have and waiting for the profits to roll in (or not as the case may be, granted).

      I agree that significant spending cuts need to be made however, most importantly in the defense and healthcare sector (why Obama thought NOW was a good time for that bill is beyond me). I’m still not sure why we’re even in Afghanistan. At this point, the political spectrum has turned completely the other direction; it is political suicide NOT to pull out.

      • ianbaker2041 Says:

        I am going to go ahead and say that Obama chose now for this bill to bolster his low approval rating going into midterm elections. Since the Republicans have to oppose him on ideological grounds, he can point fingers at them and say “hey, look at how the Republicans don’t care about you common folk. Vote for me instead.” I think that the decision was more rooted in political gain than anything else.

      • kelseymlee Says:

        In response to Ian’s comment, I think it is unfair to say that Obama chose now for this bill because it has to do with political gain more than anything. I could also say that Obama chose now for this bill because he actually cares about improving economic conditions for the American people, and that the sole reason Republicans are voting against it isn’t because they oppose him on ideological grounds, but because they sincerely want the economy to stay weak so Obama won’t get any credit for improving the economy, and, consequently, people won’t vote for him in the midterm election.

    • mfriedlander92 Says:

      I agree with the points Guysnick is making in his argument. I personally am also in agreement with the political stance of this post. I don’t think that it is fair that the people who are in the top 5% of our society are paying 20% of their income to taxes while the lowest 20% pay 3.5% of their income, supporting only 2% of the taxes in general (according to CSmonitor.com). In the history of the United States they were very big on the whole laissez-faire policy, the hands-off, where government should mind their own business and let the people make their own choices. This idea of increasing taxes for those who are in the upperclass does not seem like the government is taking a back seat and letting the people do what they want.

      I think that the quote from Jefferson is still relevant because he was one of the founding fathers of our country. I find that his idea of a frugal government is letting men decide what they want to do with their own money. For example, I don’t think the government has a right to take so much money from people’s incomes and delegate it to charity funds or government run programs. I think that if the government allowed each person to keep more of their money, they would donate it to charities of their choice and where they think the money deserves to go. Along with that point, a lot of times the money that is taken by the government from taxes goes to things that the people didn’t expect it to be going to.

      For example, I know that where I am from (Minneapolis) a lot of times the money that we think is going to go to helping schools or government-aid programs, but it has recently gone to infrastructure rebuilding. I mean I understand that some of our money is supposed to go to rebuilding the roads, but when they say that they are taking out more taxes so they can give to the needy but they are rebuilding roads, that just doesn’t seem right to me. Whatever happened to the trickle-down economic idea? The rich people are the ones who are spending the money, so eventually it will trickle down and create more jobs for the middle and lower-class.

      I think that Marx’s “Communist Manifesto” is relevant to what Obama is trying to do with this bill, but I don’t think that this is what the United States should be doing. I think that we should be going back to the lesser involved government and more back to the conservative roots. The communist theory of spreading the wealth is a great idea and is very idealistic, but in these times we need to be more realistic than optimistic. That is what the big divide between liberals and conservatives are, I believe. Like yes wouldn’t it be wonderful if everyone was above the poverty line, employed, everyone accepted everyone and loved each other, and we all held hands together and sang fucking Kumbayah in a circle, but it just isn’t going to happen. For example, competition drives the human race and if a neurosurgeon got paid the same amount as a janitor, then why would anyone want to become a neurosurgeon? If I could sit at home, unemployed, and get paid by the government why would I ever look for a job? I just don’t think that our society is ready for that type of change, there are still too many free-loaders and I truly believe that you need to work for what you earn and you should be able to keep your earnings. So in conclusion, I think that it would be in the best interest of the US to try to turn back to their conservative roots and let people divvy up their money how they choose and we should put the Marx idea of spreading the wealth away for now.

  3. Brian Hall Says:

    Taxing the rich doesn’t disincentivize competition. The rich and powerful won’t suddenly stop working if we add a few percentage points to the income tax. They’re still raking in the millions, and mostly from interest on investments, not by putting in a hard day of labor. Obviously if we were to impose prohibitively excessive taxes, like 90% of their income, then this sort of concern would be justified. As it is, the only places the wealthy can turn and run to pragmatically speaking are the tiny tax-free havens of Europe (Luxembourg, Monaco etc.). Certainly nobody would be so stupid as to suggest letting the government completely appropriate their funds, as the rich are a necessary component in creating business opportunities and jobs through investments. During the current economic crises, however, when no investment is safe, the rich are running scared and pulling all of their money. What incentive do they really have to take risks at this point? It’s better to hide the money in the bank and wait for someone else to solve the issues before reinvesting. At this point, the government has an obligation to step in and attempt to solve the issue. The only way we got out of the Great Depression was by a series of government initiatives, not the freemarket (and admittedly, the unbelievable windfall that was World War II; what better way to stoke the furnaces of American industry than by building bombs, laying waste to foreign countries’ infrustractures, then capitalizing on the reconstruction for the next half century through generous extensions of loans and aid? It’s the American way!). Had we waited for the freemarket to fix the problem, we would have ended up with an even more ridiculous concentration of wealth, and slummier conditions for the lower classes in our country. The same thing is happening right now, but the problem was caused by deregulation of the economy which has led to stupid investment behavior. Some suggested reading: http://www.nytimes.com/2011/10/14/opinion/rabbit-hole-economics.html?src=me&ref=general .

    The debate of whether or not the founding fathers would support the way our nation is structured right now is becoming increasingly irrelevant as more time passes. That’s not to say it isn’t still a very interesting philosophical question, but on a practical scale, we shouldn’t rely much on their advice. They wrote the constitution based on a country of 2.5 million people, 90% of whom were farmers and 90% British. As far as they were concerned, there was always economic opportunity and more land to be had to the west, and considering that the economy was based entirely on hard currency (whether the gold standard or property), there was virtually no reason to suggest that anybody who was poor was anything but lazy or incompetent. That’s not to mention the incredibly convenient source of free labor they had in slavery (What a libertarian wet dream! You don’t even have to pay your workers!) In modern society, none of these conditions apply. How could Jefferson, Franklin et al. predict the many and disparate effects of industrialization, the computer and information age, the cold war, and overpopulation? The notion that the constitution must necessarily be the best way of dealing with this new environment because it bears the mark of their mythical midas touch is asinine.

    Certainly I would agree that the principles of liberty presented in the constitution and the basic framework of freemarket capitalism have substantial merit, however they must be reconciled with the realities of the time we live in.

  4. jonathan keren Says:

    You touched on a lot of key points and raised a plethora of interesting and important questions. I completely agree that Jefferson would be against this new bill raised by Obama while left-wing minded people like Karl Marx would be for the Bill. Furthermore, I agree that the proposed increase in taxes will hurt the United States as a whole. First and foremost you cannot multiply wealth by dividing it (Socialism). By taxing the upper classes extremely heavily you take many of their incentives. Not only does consumption and investment get lowered, but less people get hired because companies can’t afford to hire as many people when there taxes are raised. Overall the United States has moved more and more away from a conservative mindset, especially with the passage of the new healthcare plan which was actually declared unconstitutional by over 20 states. Not only does this health care plan force people to buy health care ( or pay a penalty) but it is to be regulated by the IRS, which is part of the government. This leads to more government control and power, which is the exact opposite of what Jefferson and various other founding fathers wanted. It is about time for Americans to think about what the founding fathers wanted for America, and understand that this nation was meant to be a conservative one.

  5. kelseymlee Says:

    I don’t think the issue of Obama’s new jobs bill is reason enough to question whether or not Jefferson is still relevant today in America, or if we should start abiding by Marx’s theories. Obviously Jefferson is still important, and as mentioned in Brian Hall’s comment above, the constitution was written in a very different time and under very different circumstances. In order for our country to prosper, I believe we need to leave some things open to interpretation, and in hard economic times such as the present, I believe the president should do what he feels is best to bolster the economy and revive economic activity.

    I have to disagree with the author’s claim that taxes are not about reviving the economy, but rather about maintaining our constitution. In an economic crisis, the government is going to use whatever revenue they can gather to pull the country out of crisis mode, and I don’t see how that conflicts with maintaining our constitution.

    Everyone, corporations and wealthy Americans included, is responsible for contributing their fair share of taxes back to the U.S. government, for it is the government that has given them the opportunity to prosper and become wealthy in the first place. This op-ed by Warren Buffet shows us that even the “super-rich” Americans realize they have a responsibility to pay taxes too: http://www.nytimes.com/2011/08/15/opinion/stop-coddling-the-super-rich.html

    The author’s other argument that the government should not help those in need, it should be left up to the individual, is also one that I disagree with. While it may be frustrating to give a small portion of your money to those in need if you don’t want to, we can’t leave a crucial decision of helping those in need up to choice. The occasional food bank or soup kitchen here and there is not enough to help all those Americans who are struggling financially right now. Without government intervention through the use of social programs such as welfare, unemployment benefits and other services, I believe we would see an extreme rise in poverty, something that nobody, conservative or liberal, wants to see. The point of these programs is to help Americans, and if ever an American citizen is in extreme circumstances, they can fall back on the American government for a short period of time until they regain their footing. I understand that there are many people who cheat the system and obtain government benefits when really they are undeserving, but we can’t let those who cheat take away this sense of security for all American citizens.

  6. mrau188 Says:

    I personally believe that all government should really do is to make sure that there is no corruption in the way that we go about spreading out our wealth. Our founding fathers wanted there to be a free market and want people to set their own prices. Government should no be in charge of controlling businesses and tell them how they should go about promoting their services and creating their products. To much regulation is always a bad thing. Refer to the analogies such as when you have to fill out paperwork things are always going to get sticky when you come to the point of reviewing this specific paperwork, when we have to much regulation there is to much paperwork to go through so it is harder to get anything done. The economy will always spread itself among all of the different branches but all that we need to worry about is if the government with all of this regulation prevents this from happening.

  7. patricksylau Says:

    Let me begin by saying that I completely disagree with your point of view. The founding fathers endorsed neither philosophy. Like us, they also disagreed with what the American government should look like. Understanding that, the founding fathers created a living Constitution with broad and flexible terms so that their successors could adapt it to account for changing circumstances. The founding fathers were by no means a monolithic entity. Like us, they were bickering individuals that could not agree on many issues.

    Initially, the founding fathers tried an extremely limited government that ended with complete failure. This was known as the Articles of Confederation under which there was no central government and each state, for all intents and purposes, were sovereign countries. Though they often disagreed, the founding fathers knew that a much stronger national government was needed. This became known as the Constitution. This new constitution had a president, a court and the power to regulate the economy. Alexander Hamilton, John Adams and George Washington supported the idea of a strong national government in addition to a national bank and tariffs.

    In addition, there are a few facts I would contest. Firstly, Jefferson was by no means a conservative; he was a liberal in every sense of the word; modern conservatism did not emerge until Reagan. Secondly, it is well within the government’s responsibility to regulate the economy under the Commerce Clause. Finally, the US has one of the lowest tax rates in the world, comprising of only 27% of our economy. Most European countries have tax rates which comprise of upwards of 40% of their economy.

    So economics aside, the American Jobs Acts certainly does not fundamentally change the “American experience” because the founding fathers never envisioned a conservative tax-free government to begin with.

    • ianbaker2041 Says:

      I think that you have some nice points here, but I think others are a little flawed. Yes, the Constitution was and is a living, breathing document-part of history but also profoundly shaping our present. While there is some room for interpretation and changing times in it, the core principles-that of an individualistic America-do not need to change. That was the point of the post.

      Jefferson was most certainly conservative. He was a wealthy aristocrat who believed in small government. I can’t think of much about Jefferson that was “liberal” in a modern sense. Yes, he was “liberal” in that he supported that type of system, but in modern politics, he would be very much conservative. He’d be chilling with Reagan, not FDR, that’s for sure. While Jefferson did favor a stronger federal government, he was by no means advocating a large government or a government that provides the type of safety nets that American and European democracies do today. For better or worse, that was his view. True, the Articles of Confederation did fail; for the same reason, the Confederate States of America (CSA) failed during the Civil War. Jefferson wanted the federal government to be more powerful than the states to prevent the problems that plagued both the Articles and the CSA later on, but he still wanted the federal government to be small and remain out of the economic arena completely. In the diagram that the professor showed the other day in class of the beehive social/ economic regions, Jefferson would surely have opposed the Obama Administration’s imposition on the economy.

      I do like your point about the Commerce Clause; although I did not get into it in the post (as that would be American history and politics, which was not the point of the post), I think there’s definitely something to be said for it. There is also something to be said for how frequently it has been employed in American history to allow the government to expand its own power. Is that what it was really intended for? Probably not. As for tax rates, I tried to avoid the numbers on it for the same reason as to why I avoided getting too deeply into the Constitution-it’s just not really that relevant to my argument. Yes, the US has lower taxes than Europe, but we have far higher taxes than many other places. It’s all about who you’re comparing tax rates to-the developed world or the whole world. Given this context, I think that one can make a good case for or against more taxes (as Democrats and Republicans are trying to do now).

      I like how outspoken your comment is though 🙂

%d bloggers like this: