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	<title>Dose of Clarity &#187; job creation</title>
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	<description>Logic and common sense</description>
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		<title>Supply-side economics: The basic reality</title>
		<link>http://doseofclarity.com/politics/supply-side-economics-the-basic-reality/</link>
		<comments>http://doseofclarity.com/politics/supply-side-economics-the-basic-reality/#comments</comments>
		<pubDate>Mon, 14 Dec 2009 17:07:43 +0000</pubDate>
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				<category><![CDATA[Politics]]></category>
		<category><![CDATA[class warfare]]></category>
		<category><![CDATA[investors]]></category>
		<category><![CDATA[job creation]]></category>
		<category><![CDATA[prosperity]]></category>
		<category><![CDATA[supply-side]]></category>

		<guid isPermaLink="false">http://doseofclarity.com/?p=641</guid>
		<description><![CDATA[Round and round we go on the everlasting debate about supply-side economics.  We all choose which side of the argument we would like to believe and then hop on the merry-go-round arguing about something that seems so straightforward.  Supporters of this concept believe that if incentives or benefits are given to investors, they [...]]]></description>
			<content:encoded><![CDATA[<p>Round and round we go on the everlasting debate about supply-side economics.  We all choose which side of the argument we would like to believe and then hop on the merry-go-round arguing about something that seems so straightforward.  Supporters of this concept believe that if incentives or benefits are given to investors, they will in turn invest their money in productive endeavors that will provide jobs and value to the community.  Central to this belief is that any money invested in an enterprise is first applied to employee compensation and then all other expenses of production, and only then does it return to investors if a profit has been realized.  The opposing camp to this debate believes that all the focus should be on making the masses prosperous and the resulting bounty will raise the whole class and all those above them.  This common viewpoint provides a good sound bite, but it lacks logic and any basis in reality.  </p>
<p>It is very interesting to see our own Government’s vicious opinion regarding supply-side economics and how it is nothing more than <span id="more-641"></span>a ploy to make the rich even richer while taking advantage of common Americans in the process.  It becomes all too easy to engage in the usual class warfare that is so typical of our politicians in their constant attempt to buy votes.  However, we should examine their actions versus their words.  Over the last year, we have witnessed our Government intervening in certain company negotiations such as the car companies, because they know that failure will impact too many jobs at both the company itself and every supplier that touches it, and in their opinion this prospect is too costly to withstand.  That cost manifests itself in bloated unemployment claims followed by decreased tax revenues, which is an unacceptable outcome.  Despite all the objections regarding supply-side economics brought forth from our elected officials, their actions speak quite loudly.  If they did not believe in its merits, then job losses would not be a concern.  In fact they are now beginning to float the idea that small businesses should get tax breaks and subsidies in order to create jobs, this should say it all regarding the reality of this debate.</p>
<p>The notion of Supply-side economics is really simple and straightforward regardless of how badly one would like to disagree.  First of all, in order for common Americans to be prosperous, they must be employed above all else.  Secondly, in order to have paying jobs available, there must be viable companies in operation. Thirdly, companies can only exist if there are parties willing to take the risk and invest their money to provide the necessary capital for operations.  Fourthly, if money is needed then it must be obtained from those that have it to invest.  Last but not least, the most important point to consider is a simple truth, those in our society with investable funds can not be forced to invest, thus it remains their choice and they can only be enticed into action through incentives and favorable policies.  A successful program of bringing widespread prosperity to the masses must come into agreement with these points, for there is no other way to accomplish this goal.  Perhaps instead of critics having contempt for the wealthy for getting incentives to invest their money maybe they should focus instead on its resulting job creation.  Unfortunately, that lesson will be a hard one to accept over the coming months and years in our nation as many people struggle to acknowledge it in light of declining prospects and living standards, yet our politicians will be more than happy to raise their objections in order to fuel more destructive class warfare. </p>
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