By - October 6, 2011

The New-New Jobs Bill Deconstructed

Democrats trying to make the “jobs” bill more palatable decided to remove the additional tax burdens on persons making $200,000 and more and shift it to the millionaires.

The idea is to put republicans on the defensive, insisting that Americans want the “rich” to pay their “fair share”.  I will get back to this premise later, but lets look at the bill to see if it truly is a “Jobs Bill”.

The bill does provide tax credit, not tax cuts for hiring certain people and is only temporary that being one year.  Here is the title that spells that out: SEC. 102. TEMPORARY TAX CREDIT FOR INCREASED PAYROLL.  The title of said section tells the story.

Obama has lamented stories about unemployed teachers, so the new jobs bill contains an answer to those educators who find themselves in soup lines.  The answer?….The same answer as in the original stimulus, giving money for teachers for two years.  Money is again provided for the hiring of teachers through next school year 2012-2013 (Sec 202), after which those teachers will once again get a pink slip.

Page 30 provides $4 billion for high speed rail, which I have proven is wasted money anywhere but certainly in the US, find out how bad this investment is in this article: High Speed Money Flusher.

Section H is a portion of the bill dedicated to Obama’s friend, LightSquared.  If you are unfamiliar with LightSquared, this is a company the Obama administration was pressuring a General into changing his testimony to Congress in favor of LightSquared.

This bill continues to play favoritism to the “Green Economy”, putting more money in the hands of companies the likes of Solyndra.  We saw how well that worked.

Obama has made it clear that nothing stimulates an economy like Unemployment Benefits, and to that end he is extending the current benefits until December 2013 (Sec 311).

Attempts are made to get people back to work with this bill, but like any other lawyer the answer is litigation.  This bill allows an unemployed person to sue a potential employer if the unemployed person believes he was not hired because he is “unemployed”.  This is extending the equivalent of racial civil rights to the “unemployed”.  How many people think this will increase hiring?

Now that we established that this bill is anything but a “jobs” bill, let’s look at the payment mechanism.

Senator Reid changed the financing of this bill recently.  The mechanism is now to add a 5.6% surtax on those who make $1 million/year or more.  This tax is said to be in place for at least 10 years, but once a tax is levied it is nearly impossible to expire it.  I would be all for taxing Warren Buffett but I don’t find any consolation in knowing millionaires will be fleeced for this boondoggle.  Taking the top marginal rate of 35% then adding the surtax puts these people at a 40.6% tax rate.  Now, remember the current tax rates expire in 2012.  After the tax rates expire that will add an addition 4.9% to those in the top tax bracket putting these people at a 45.5% tax rate for just the federal responsibility.  Within one year these people could have just over a 10% increase in tax burdens.  Who thinks this will help add jobs?

Sounds like more than their fair share to me.

If the Republicans are smart they will attack this bill for all it’s faults.  The bill is the Great Stimulus Bill Junior.  We all know that the original stimulus was a huge payoff to political friends and a bust to the taxpayers.

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