Will new Senate bill help create jobs?
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Bob Moon: Lawmakers are telling us that creating jobs will be top priority when they return from the President’s Day recess, on George Washington’s birthday, 10 days from now. But those on-again, off-again bipartisan negotiations in the Senate have fallen apart. A frustrated Senate majority leader now intends to bring up a dramatically scaled-back bill of business tax incentives for the hiring of new employees.
Our Washington bureau chief John Dimsdale sorts out some of the differences over what’s the best way for the government to stimulate jobs.
John Dimsdale: Majority leader Harry Reid scrapped a bipartisan agreement to spend $85 billion on a wide range of tax breaks for businesses. Instead, he’s pushing a $15-billion bill with a limited number of tax incentives for small businesses to hire and retain new employees.
Lawrence Mishel: All of these efforts are puny efforts at creating jobs.
Lawrence Mishel is president of the Economic Policy Institute. He backs $400 billion worth of infrastructure projects, aid to state and local governments and extensions of unemployment benefits and food stamps.
Mishel: This alone would create 900,000 jobs by giving money to people who have a lower standard of living, because they’ve lost their job. They’re not saving it, they’re going to spend it throughout the economy.
But spending money on social safety net programs is not an efficient way to generate jobs, says University of Southern California finance professor Larry Harris.
Larry Harris: Paying people to remain unemployed doesn’t get much value from those people. It would be better to use the money to employ them — at a minimum, picking up litter on the sides of our highways.
Harris says the Senate has the right idea — tax incentives for businesses to hire new workers.
Harris: Congress ensures that people are only hired if a private employer thinks that it’s worth hiring the person.
But Mishel says companies won’t hire anyone until they see more demand for their goods, and putting money in the pockets of the poor and unemployed will generate that demand.
In Washington, I’m John Dimsdale for Marketplace.
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