I watched the President’s jobs speech hoping to hear something big and bold. I just do not see this plan moving the needle all that much, even if adopted fully. As to whether it will be adopted at all I would have to say I doubt it. The portion of the speech where the President talked about the tax code changes that he advocates for, and which I agree with, struck me as laying the groundwork for the 2012 election cycle. House Republicans will not be agreeing anytime soon to the elimination of the Bush tax cuts for top earners. The balance of the proposals may provide some short term stimulus, but I do not see a bunch of economic movement based on these proposals. But I do not see Republicans promoting anything that is going to move the needle on unemployment either.
Tax incentives for hiring, absent a surge in demand, will subsidize employment that likely will have happened anyway. And creating some additional demand by putting more money in consumers pockets is a good thing, but I do not see this proposal as having much of a stimulative impact in that area. The problems are deep seated, and not subject to easy answers. The lack of job creation in the economy may take some time to rectify.
My last thought is on the uniquely American demand for instant gratification. The first stimulus bill took a pass on much infrastructure spending because we did not have “shovel ready” projects. Well if we had simply been patient back then, and got started on many badly needed infrastructure projects those projects would now be breaking ground, and we would be getting ready to hire a whole bunch of construction workers to rebuild our crumbling bridges and roads and schools. Instead we always go for the short term, looking for quick results, instead of investing for the longer term. It is a shame.
The President is traveling the country, selling the American Jobs Act. His first stop? Eric Cantor’s Congressional District.