So the President finally revealed his new "Jobs" bill last week and it's even worse than I suspected. The payroll tax cuts that make up most of the bill and are supposed to encourage hiring don't even go to employers! Instead, the cuts are simply a reduction of the Social Security tax paid by employees. What part of lowering the cost of hiring don't the Democrats understand? Are they so antagonistic towards employers that they won't do anything to encourage them to hire?
What's ironic about the President's proposal is that it's a clear example of the trickle-down economics that the Democrats have mocked for years--writ very, very teeny. The problem, in this instance, though, is that the money is coming out of a program that's already in danger of failing and will just push it a little closer to the brink. Since the reduction in payroll taxes will be exactly offset by an increase in Social Security's liabilities, how exactly is that supposed to boost the economy? [When tax cuts are actually offset by spending cuts, that's a different ballgame. Then spending shifts to the private sector, which is far more efficient at producing goods and services--and the jobs that go with them--than the government. Tax cuts that aren't offset by spending cuts, whether made by Republicans or Democrats, have the same incremental utility: NONE.]
While the President's plan may boost spending in the short-run it's very unlikely that any meaningful increase in employment will result. Business people look past this sort of short-term manipulation when they decide whether or not to hire. They aren't as stupid as the President thinks they are and he isn't as smart as he is constantly told.