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Tuesday, 14 January 2014 08:16

The Alleged "Job Creators" Are Really the "Job and Payroll Takers"

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I got to admit that I keep a barf bag with me for everytime I see a member of the Wall Street 1% or a Republican poobah repeat their perennial meme of the wealthy being "job creators."

In fact, I avert my eyes and put my fingers in my ears now whenever that phrase pops up -- which is far too often, given that the right wing is very good at repeating memes sent to them from the authoritarian leadership and their masters of propaganda.

There are far too many ways to list how the wealthy are the real "takers" in our society, but I will take a stab at a few.  In fact, many of the jobs that they create are for cleaning up after the messes that they make.

Think about how many people were employed to clean up after the BP oil spill in the Gulf of Mexico, or on a smaller scale the many ongoing chemical and fossil fuel environmental catastrophes like the most recent one in West Virginia. Crisis management after these disasters means people are finally getting hired.

Then you have all the new paid positions that are necessary to clean up after global warming disasters, such as Hurricane Katrina and Sandy, just to name two of far too many. Of course, you had all the people who needed to be hired to start pulling the financial world and housing markets back together after Wall Street crashed the economy.  You have all the lawyers and legal related professions who get income off of investigating (of course perish the thought that they might actually be charged with a crime) or negotiating "settlement agreements" with governmental agencies on behalf of Wall Street banks, such as JP Morgan. There's some job creation for you!

But just to start the ball rolling, I'll list five ways in which corporations and the financial industry are, in general, "takers":

1) Currently, many of the largest US corporations and financial institutions are sitting on piles of cash instead of re-investing profits in the economy. Why? In large part because working class consumers don't have sufficient funds to support expansion of production (even if such a large percentage of the manufacturing and assembling is overseas). So, many of these so-called "job creators" are actually taking inflated profits from US consumers (due to using low cost labor overseas and now increasingly domestically) and holding onto the money, using it to give large salaries and stock options to CEOs, and distributing it in dividends -- all the while driving up the stock prices.

2) The increased profits of US-based corporations are largely due to decreased labor costs by breaking the unions here and shipping jobs overseas.   If GE, for example, is a big job creator, the jobs it is most interested in creating are overseas, not in the US. Although it does create some employment in the US, in general it makes profit from US consumers and contracts, but creates jobs in other nations.

3) As Bill Quigley detailed in a BuzzFlash at Truthout commentary today, "Ten Examples of Welfare for the Rich and Corporations," corporations and big finance are dependent, in large part, on direct and hidden subsidies from the government -- better known as revenue from tax dollars redistributed to "free market" corporations.  The business world (the large institutional one) milks the cow of federal, state and local government for corporate welfare worth hundreds and hundreds of billions of dollars.  Just ask -- as one "minor" example -- all those big agricultural companies and large-scale farmers who are paid by the federal government not to grow crops, paid for literally doing nothing.

I won't even get into the Elizabeth Warren argument that taxpayers subsidize large companies through providing a free educated workforce to them, through the building of a transportation infrastructure, through the provision of free access to the public commons that yields an enormous profit (take television for example), and so on.  That's top-tier, gold level taking for sure.

4) But despite last month's dismal job report, employment has been growing in the United States you say, so big corporations and Wall Street must be creating long-term jobs. Actually, some Republicans who argue that small businesses create the bulk of jobs in the US are right: 65 percent according to the Wall Street Journal. But, in general, small businesses are not the recipients of the lavish federal giveaways to big business.  They do not benefit from being on the stock exchange and having people pay only 15% taxes on income from long-term gains in the market.  They do not receive trillion dollar bailouts like the top banks who cratered the economy did.

In reality, the likes of Mitt Romney and his predatory Bain Capital practices are hellbent on driving small businesses out of business to take advantage of economies of scale -- including minimum wage paychecks or thereabouts -- and shutting down the stores and small family firms to build the value of large corporations.  Net jobs are lost when box stores replace smaller businesses.  Staples (Romney's favorite example of being a "job creator") didn't create more jobs.  It consolidated fewer jobs in a larger distribution system while forcing small stationery and office supply stores that paid better wages and supported families out of business. 

The likes of Bain Capital are job takers if you look at the overall economy. By reducing pay and the number of jobs through building of larger distribution warehouse-style box stores, they reduce the number of jobs and small businesses in a given product area.  They are carcass eaters.

5) By creating stagnating wages since at least the 1990s -- at a time of increased worker productivity -- many workers have been forced into debt. The behemoth financial industry makes a mega-profit off of the humongous interest charged on credit cards, for example.  This is money paid to the banks for the "privilege" of borrowing dollars that might otherwise be spent on consumer goods that would generate more jobs, which leads us back to the "job taker" process described in point one. Yet, even though the bank might charge an indebted worker 29% interest on a credit card balance, the same bank is only paying .01% interest on "savings accounts."  That's some usurious taking right there.

This list of how large corporations and financial firms are domestic "takers" could go on for literally pages, but it's time we start calling Wall Street and the Chamber of Commerce/ALEC oligarchs who control Congress and most states legislatures what they are: "job takers," predatory vultures whose talons are tearing away at economic stability for the vast majority of Americans.

(Photo: Caroline Schiff Photography)