Economic Growth Not Redistribution

The economy remains in stagnation and employment is still poor. Instead of looking at the unemployment figures what we need to look at is employment figures. 92 million people have dropped out of the workforce and we have a labor participation rate of 62.8%. these are the lowest employment figures since WWII.

One of the reasons they are not getting any better is the increase in benefits to the non working. With nearly 50 million people on food stamps, unemployment compensation dragged on now so that recipients can collect for more than 3 years running and disability claims at an all time high, Americans are staying home rather than look for work.

Of course that is just what the Democrats want. Their deal with the American people is we will trade you benefits for votes. That is the Inequality of Income mantra of Obama and his redistributionist policies. But that doesn’t grow the economy and provide jobs for an ever increasing population.

Here is what the Democrats are essentially doing. With laws like Obamacare and Dodd-Frank, with the removal of the work requirement from welfare reform, with a massive hard sell campaign on Food Stamps and other benefits, with increases in welfare benefit payouts and more liberal approval of diability claims the Democrats have actually prolonged and then created a sick economy. Then they come back with their demand that we up the ante on government benefits becsue so many people are in dire need. But so many people are in trouble precisely because of the policies of the Democrats. It’s like a never ending circle. More benefits yields more people in need >> increases in benefits>> greater need >> solution even more and higher benefits >> even more distress. All this of course must be financed by higher taxes.

The solution here is not REDISTRIBUTION it’s ECONOMIC GROWTH! Supply side Economics – a stable currency, lower taxes and fewer regulations – gave us over 25 years of the longest economic boom in the history of the modern era. Let’s put people back to work in a good paying private enterprise job. Not only will you have a more prosperous citizen but you will also get a tax payer.

WHEN THE TAKERS OUT NUMBER THE GIVERS THE GIVERS GIVE UP.

Economic guru Larry Kudlow who spoke with the head of the Business Roundtable Randall Stephenson, had this to say:

But this year, the BRT has gone back to basic economic blocking and tackling by bluntly saying, “If we want to control the deficit, preserve key entitlement programs, educate our children, and offer upward economic mobility for everyone, we have to get our economy growing faster.”

Sounds like JFK. Or Ronald Reagan. Or Jack Kemp. A rising tide lifts all boats.

“And make no mistake, economic growth doesn’t happen absent private investment. . . . Where there is investment — a new factory, or distribution facility being built, a new store about to open, new software being installed — that is where new jobs are created.”

Trouble is, as I pointed out to Stephenson, President Obama is talking about inequality and income redistribution, not growth.

Instead of unleashing entrepreneurship, Obama harps on raising the minimum wage and extending unemployment assistance. Of course, increased investment that doubles the rate of job creation would make minimum-wage and unemployment-benefit discussions unnecessary.

Obama would also penalize corporations that hold profits overseas rather than lower penalties so this money would come home for private investment.

In fact, most of the Democratic party has embarked on a path to punish success, not reward it; to enlarge the reach of government in business, rather than incentivize entrepreneurship. I call this the Sandinista wing of the Democratic party. It’s named after New York City mayor Bill de Blasio, who spent a goodly amount of time in Nicaragua and Cuba and is in full-fledged attack mode to punish successful earners and businesses by raising taxes of “fairness.”

Fairness is not opportunity. But tell that to Massachusetts senator Elizabeth Warren, who also is arguing for punishments on business and banking. De Blasio and Warren are spewing forth the socialist doctrine of equality of results, rather than the capitalist model of equality of opportunity. They want income leveling and redistribution — the opposite of growth.

Unfortunately President Obama appears to have caught the Sandinista disease. And the Business Roundtable and the whole American business community will have on heck of a time turning him around.

But then again, that’s what elections are for. And that’s why we’re going to see big changes come November. (1)

(1) Business Wants Growth, Growth, Growth
But the Sandinista Democrats will have none of it.

By Larry Kudlow , National Review – http://www.nationalreview.com/article/368801/business-wants-growth-growth-growth-larry-kudlow