Sunday, May 29, 2011

Who Are the "Job Creators"?

The upshot of my last post was that an enterprise cannot grow or generate profits without affecting everything around it in complicated ways, including the very foundations of its own success.  Nothing occurs in a vacuum, yet too often, when talking about the economy, that is how we think.

This applies particularly to the concept of "job creation."  In the U.S. that is the number one topic of conversation, and almost all of those conversations are deeply irritating to me.  People talk as if jobs are "created" primarily through the wise decisions of businessmen.  Successful businesses breed more jobs.  In fact, the word "job creator" is currently used as a euphemism for "capitalist" or "CEO."

I saw a video production from Glenn Beck that pretty well summarizes this point of view.   ...And, I cannot seem to find it online.  Since I do not want to waste my entire evening looking for it, I will describe.  Essentially, it is a children's school film, designed to counter a film or a series of films that Beck claims are shown regularly in public schools in order to brainwash children.  He proposes his film be shown instead.  The essence:  allow wealthy business men to prosper, and they will create lots of new jobs.  Okay, I don't remember any of the details, except that there were stick figure drawings, so maybe it wasn't worth even bringing it up.  However, after showing the film, Beck also commented that, because Bill Gates had the incentive to make lots of money, he built a successful company that created all sorts of new jobs in the computer and tech industries.

Job creation does not occur in a vacuum.

Bill Gates may have created some new jobs.  But what about all the jobs lost in the industries that were made obsolete by his computer technology?  What about all the potential jobs that were lost because of his monopolization of the market?  What about the jobs lost as a result of computers doing work that people used to do?

Even the simple act of creating new jobs or starting a new enterprise has all sorts of complicated effects, including job loss and the destruction of other enterprises.

Doesn't it seem just too easy that simply giving businesses tax breaks, or other such incentives, will magically create jobs and grow the economy?  It is.  That is an incredibly myopic view of economics.  When you are dealing with something as complex as the economy, nothing is that easy.

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