Rich people do not create jobs

Read this interesting speach Venture Capitalist Nick Hanauer:

"It is astounding how significantly one idea can shape a society and its policies. Consider this one.

If taxes on the rich go up, job creation will go down.

This idea is an article of faith for republicans and seldom challenged by democrats and has shaped much of today's economic landscape.

But sometimes the ideas that we know to be true are dead wrong. For thousands of years people were sure that earth was at the center of the universe. It's not, and an astronomer who still believed that it was, would do some lousy astronomy.

In the same way, a policy maker who believed that the rich and businesses are "job creators" and therefore should not be taxed, would make equally bad policy.

I have started or helped start, dozens of businesses and initially hired lots of people. But if no one could have afforded to buy what we had to sell, my businesses would all have failed and all those jobs would have evaporated.

That's why I can say with confidence that rich people don't create jobs, nor do businesses, large or small. What does lead to more employment is a "circle of life" like feedback loop between customers and businesses. And only consumers can set in motion this virtuous cycle of increasing demand and hiring. In this sense, an ordinary middle-class consumer is far more of a job creator than a capitalist like me.

So when businesspeople take credit for creating jobs, it's a little like squirrels taking credit for creating evolution. In fact, it's the other way around.

Anyone who's ever run a business knows that hiring more people is a capitalists course of last resort, something we do only when increasing customer demand requires it. In this sense, calling ourselves job creators isn't just inaccurate, it's disingenuous.

That's why our current policies are so upside down. When you have a tax system in which most of the exemptions and the lowest rates benefit the richest, all in the name of job creation, all that happens is that the rich get richer.

Since 1980 the share of income for the richest Americans has more than tripled while effective tax rates have declined by close to 50%.

If it were true that lower tax rates and more wealth for the wealthy would lead to more job creation, then today we would be drowning in jobs. And yet unemployment and under-employment is at record highs.

Another reason this idea is so wrong-headed is that there can never be enough superrich Americans to power a great economy. The annual earnings of people like me are hundreds, if not thousands, of times greater than those of the median American, but we don't buy hundreds or thousands of times more stuff. My family owns three cars, not 3,000. I buy a few pairs of pants and a few shirts a year, just like most American men. Like everyone else, we go out to eat with friends and family only occasionally.

I can't buy enough of anything to make up for the fact that millions of unemployed and underemployed Americans can't buy any new clothes or cars or enjoy any meals out. Or to make up for the decreasing consumption of the vast majority of American families that are barely squeaking by, buried by spiraling costs and trapped by stagnant or declining wages.
Here's an incredible fact. If the typical American family still got today the same share of income they earned in 1980, they would earn about 25% more and have an astounding $13,000 more a year. Where would the economy be if that were the case?

Significant privileges have come to capitalists like me for being perceived as "job creators" at the center of the economic universe, and the language and metaphors we use to defend the fairness of the current social and economic arrangements is telling. For instance, it is a small step from "job creator" to "The Creator". We did not accidentally choose this language. It is only honest to admit that calling oneself a "job creator" is both an assertion about how economics works and the a claim on status and privileges.

The extraordinary differential between a 15% tax rate on capital gains, dividends, and carried interest for capitalists, and the 35% top marginal rate on work for ordinary Americans is a privilege that is hard to justify without just a touch of deification

We've had it backward for the last 30 years. Rich businesspeople like me don't create jobs. Rather they are a consequence of an eco-systemic feedback loop animated by middle-class consumers, and when they thrive, businesses grow and hire, and owners profit. That's why taxing the rich to pay for investments that benefit all is a great deal for both the middle class and the rich.

So here's an idea worth spreading.

In a capitalist economy, the true job creators are consumers, the middle class. And taxing the rich to make investments that grow the middle class, is the single smartest thing we can do for the middle class, the poor and the rich.

Thank You.

http://roundtable.nationaljournal.com/2012/05...

This is the first half of a great speach by Venture Capitalist Nick Hanuaer, somehow it got lost.

It is astounding how significantly one idea can shape a society and its policies. Consider this one.

If taxes on the rich go up, job creation will go down.

This idea is an article of faith for republicans and seldom challenged by democrats and has shaped much of today's economic landscape.

But sometimes the ideas that we know to be true are dead wrong. For thousands of years people were sure that earth was at the center of the universe. It's not, and an astronomer who still believed that it was, would do some lousy astronomy.

In the same way, a policy maker who believed that the rich and businesses are "job creators" and therefore should not be taxed, would make equally bad policy.

I have started or helped start, dozens of businesses and initially hired lots of people. But if no one could have afforded to buy what we had to sell, my businesses would all have failed and all those jobs would have evaporated.

That's why I can say with confidence that rich people don't create jobs, nor do businesses, large or small. What does lead to more employment is a "circle of life" like feedback loop between customers and businesses. And only consumers can set in motion this virtuous cycle of increasing demand and hiring. In this sense, an ordinary middle-class consumer is far more of a job creator than a capitalist like me.

So when businesspeople take credit for creating jobs, it's a little like squirrels taking credit for creating evolution. In fact, it's the other way around.

Anyone who's ever run a business knows that hiring more people is a capitalists course of last resort, something we do only when increasing customer demand requires it. In this sense, calling ourselves job creators isn't just inaccurate, it's disingenuous.

That's why our current policies are so upside down. When you have a tax system in which most of the exemptions and the lowest rates benefit the richest, all in the name of job creation, all that happens is that the rich get richer.

Ooops.....disregard post #3, not sure how that got so messed up.

Curtain Rod wrote:

Read this interesting speach Venture Capitalist Nick Hanauer:
"It is astounding how significantly one idea can shape a society and its policies. Consider this one.
If taxes on the rich go up, job creation will go down.

>
>
NICK HANAUER hits the nail squarely on the head, me and HERE IS ONE already went round and round about this for months and no matter how hard he tried, HERE IS ONE could not disprove what this multimillionaire says, but he sure tried his best to confuse the issue with irrelevant IRS charts...

Here is a video of a talk Nick gave at TED ...

http://business.time.com/2012/05/18/was-nick-...

Your post infers that the chicken came first.
In other words, consumers automatically have money to spend.
Not so. Consumers need to have a job in order to spend. The government does not create jobs.
Higher taxes are needed in order to finance government jobs, and higher taxes force private businesses to delete jobs.
The high regulatory environment also forces businesses to delete jobs as it is expensive to comply with the plethora of current government regulations.
Just look at our wonderful state of california. Broke and jobless. The reason?
High taxes and over regulation.
I am an employer. I can tell you that at least two positions have been eliminated due to over regulation, and over taxation.
I will make a profit, or I WILL simply lay off everyone else and quit paying through the nose to support a very intrusive overbearing government.

On the other hand, if I am making money, I will make my life easier by hiring more help.
You figure it out.

GRANDPA NICOLAI wrote:

<quoted text>
>
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NICK HANAUER hits the nail squarely on the head, me and HERE IS ONE already went round and round about this for months and no matter how hard he tried, HERE IS ONE could not disprove what this multimillionaire says, but he sure tried his best to confuse the issue with irrelevant IRS charts...
Here is a video of a talk Nick gave at TED ...
http://business.time.com/2012/05/18/was-nick-...

California's experiment in your way of thinking(socialism) is failing miserably.....and getting worse.
"The problem with socialism is that eventually you run out of other people money."
Congrats. California is there.

Curtain Rod wrote:

Ooops.....disregard post #3, not sure how that got so messed up.

You are arguing that without consumers the rich can't create jobs and that is a lie.........LOL

First I have had a team working years on a project that I have been paying their wages and not one product has been sold.......
It is research and development.......

Second show me any poor person that has created jobs..........LOL

Third consumers only get the money they have to spend from working at a job.....

Bottom line with out consumers I have and many others will hire people.....

You can have all the consumers you want but if you don't have someone with money to create a product or service they will have nothing to spend their money on.....

chicken or the egg wrote:

Your post infers that the chicken came first.
In other words, consumers automatically have money to spend.
Not so. Consumers need to have a job in order to spend. The government does not create jobs.
Higher taxes are needed in order to finance government jobs, and higher taxes force private businesses to delete jobs.
The high regulatory environment also forces businesses to delete jobs as it is expensive to comply with the plethora of current government regulations.
Just look at our wonderful state of california. Broke and jobless. The reason?
High taxes and over regulation.
I am an employer. I can tell you that at least two positions have been eliminated due to over regulation, and over taxation.
I will make a profit, or I WILL simply lay off everyone else and quit paying through the nose to support a very intrusive overbearing government.
On the other hand, if I am making money, I will make my life easier by hiring more help.
You figure it out.

100 percent correct........

But liberals will assume that they will get their money from welfare so they will be able to buy lots of smokes and booze.....

Here Is One wrote:

<quoted text>
You are arguing that without consumers the rich can't create jobs and that is a lie.........LOL
First I have had a team working years on a project that I have been paying their wages and not one product has been sold.......
It is research and development.......
Second show me any poor person that has created jobs..........LOL
Third consumers only get the money they have to spend from working at a job.....
Bottom line with out consumers I have and many others will hire people.....
You can have all the consumers you want but if you don't have someone with money to create a product or service they will have nothing to spend their money on.....

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Yah, sure, whatever you say....

Tell us all about your team ,(or metaphor as you call it,) to whom you paid $20K per year to sell gum balls for $1,000,000 bucks a piece.

Just because you are foolish enough to pay someone to manufacture products for which there is no market does not mean that other smart businessmen operate in the same dumb way you do...

Instead of constantly running your mouth in an incoherent fashion as you are fond of doing here on TOPIX, and I presume everywhere else, you ought to take the time, listen and try to understand what the man is saying instead of making an even bigger fool of yourself, like you did with your diatribes about Catholics not being Christians...

http://business.time.com/2012/05/18/was-nick-...

chicken or the egg wrote:

Your post infers that the chicken came first.

I will make a profit, or I WILL simply lay off everyone else and quit paying through the nose to support a very intrusive overbearing government.
On the other hand, if I am making money, I will make my life easier by hiring more help.
You figure it out.

>
>

Are you arguing that the egg came first...?

The only way you will ever make a profit is if your customers demand your products or service.

If there is great demand for whatever you offer and you are out to make money, your customers will FORCE you to hire more people,( you don't hire people out of the goodness of your heart) that is how customers create the jobs.

If you are a tightwad and do not want to hire any more people then the customers will FORCE someone else to hire more people to fill the demand for said products or services ... what is so hard to understand about that...?

GRANDPA NICOLAI wrote:

<quoted text>
>
>
Yah, sure, whatever you say....
Tell us all about your team ,(or metaphor as you call it,) to whom you paid $20K per year to sell gum balls for $1,000,000 bucks a piece.
Just because you are foolish enough to pay someone to manufacture products for which there is no market does not mean that other smart businessmen operate in the same dumb way you do...
Instead of constantly running your mouth in an incoherent fashion as you are fond of doing here on TOPIX, and I presume everywhere else, you ought to take the time, listen and try to understand what the man is saying instead of making an even bigger fool of yourself, like you did with your diatribes about Catholics not being Christians...
http://business.time.com/2012/05/18/was-nick-...

CNBC just had a guy on who is saying that greece should default on its bond holders as there is no way to dig out of their massive debt. Greek government spending is now at 49% of their GDP(mostly borrowed money).......and rising. As taxes have gone up, jobs have been lost and tax revenue has gone down. The greek government is spending borrowed money. Soon, nobody will want to own their debt.
Sound familiar?
yup.........California is on the same road....... as is the U.S. government.(U.S. government spends roughly 25% of the GDP...40% borrowed money).

Curtain Rod wrote:

Read this interesting speach Venture Capitalist Nick Hanauer:
"It is astounding how significantly one idea can shape a society and its policies. Consider this one.
If taxes on the rich go up, job creation will go down.
This idea is an article of faith for republicans and seldom challenged by democrats and has shaped much of today's economic landscape.
But sometimes the ideas that we know to be true are dead wrong. For thousands of years people were sure that earth was at the center of the universe. It's not, and an astronomer who still believed that it was, would do some lousy astronomy.
In the same way, a policy maker who believed that the rich and businesses are "job creators" and therefore should not be taxed, would make equally bad policy.
I have started or helped start, dozens of businesses and initially hired lots of people. But if no one could have afforded to buy what we had to sell, my businesses would all have failed and all those jobs would have evaporated.
That's why I can say with confidence that rich people don't create jobs, nor do businesses, large or small. What does lead to more employment is a "circle of life" like feedback loop between customers and businesses. And only consumers can set in motion this virtuous cycle of increasing demand and hiring. In this sense, an ordinary middle-class consumer is far more of a job creator than a capitalist like me.
So when businesspeople take credit for creating jobs, it's a little like squirrels taking credit for creating evolution. In fact, it's the other way around.
Anyone who's ever run a business knows that hiring more people is a capitalists course of last resort, something we do only when increasing customer demand requires it. In this sense, calling ourselves job creators isn't just inaccurate, it's disingenuous.
That's why our current policies are so upside down. When you have a tax system in which most of the exemptions and the lowest rates benefit the richest, all in the name of job creation, all that happens is that the rich get richer.

I see you decided to come back out here and give us all this wisdom. So what if rich don't create jobs from your smart stuff thinking. What does that mean? Who is rich? Are you? Should we do what with them? What the hell is in some of your thinking? Screw the rich, I am trying to survive with the poor and there aren't enough rich to help that but there are to many of you to suppress to many of us. STFU and just draw that damn government check you get. For Gods Sake (aka Obama to you) man, between people like you, unions, government and those stinking rich we are all getting a flipping belly ache. People like you are the problem poor people have no flipping money jerk. Obama all mighty this is like talking to children.

Do us all a favor so us poor don't get anymore flipping pissed than we are and stop writing posts that look like you are taking one of those "Blue Book" tests of BS you did in school. Hell man, have a little humility and don't act like what you say will cause Topix to have to buy a server to hold it.

Here Is One wrote:

<quoted text>
You are arguing that without consumers the rich can't create jobs and that is a lie.........LOL
First I have had a team working years on a project that I have been paying their wages and not one product has been sold.......
It is research and development.......
....

By your logic the government clearly creates far more jobs than rich people do because the government, thanks to tax and spend liberal projects, spends far more money on research and developement, not to mention large Construction and infrastructure projects like Dams and Highways, than any private investors do.

Yet you deny that the government creates jobs and then say what you just said out oc the same mouth.

LOL.

Godfrey wrote:

<quoted text>I see you decided to come back out here and.....

I have been here all along Godfey, I just got tired of being accused constantly by "here is one" and most of the rest of you conservatives of being Middle of the road, grandpa, tsq,and just about every other liberal on here. That , at a time when the only name I used was "curtain rod" . I got tired of arguing that I was in fact NOT all those othr people, but that it wouldn't really make any difference if I was would it? Eventually I just decided there is no point in having one anonymous name I might as well change it with the wind. If I couldn't convince Here is one of how stupid it would be to change names all the time, I might as well play into his paranoia and change names constantly. What difference does it make? Does it matter who you are talking to?

CurtiangrandpamiddTSQover wrote:

<quoted text>
I have been here all along Godfey, I just got tired of being accused constantly by "here is one" and most of the rest of you conservatives of being Middle of the road, grandpa, tsq,and just about every other liberal on here. That , at a time when the only name I used was "curtain rod" . I got tired of arguing that I was in fact NOT all those othr people, but that it wouldn't really make any difference if I was would it? Eventually I just decided there is no point in having one anonymous name I might as well change it with the wind. If I couldn't convince Here is one of how stupid it would be to change names all the time, I might as well play into his paranoia and change names constantly. What difference does it make? Does it matter who you are talking to?

No. It is all virtual.

GRANDPA NICOLAI wrote:

<quoted text>
>
>
Yah, sure, whatever you say....
Tell us all about your team ,(or metaphor as you call it,) to whom you paid $20K per year to sell gum balls for $1,000,000 bucks a piece.
Just because you are foolish enough to pay someone to manufacture products for which there is no market does not mean that other smart businessmen operate in the same dumb way you do...
Instead of constantly running your mouth in an incoherent fashion as you are fond of doing here on TOPIX, and I presume everywhere else, you ought to take the time, listen and try to understand what the man is saying instead of making an even bigger fool of yourself, like you did with your diatribes about Catholics not being Christians...
http://business.time.com/2012/05/18/was-nick-...

I have told you it 100 times or more.......
I had a large team working on a project that I was paying them 20k per year plus expenses to find out how much the traffic would bare for pricing on different projects.........LOL

We where not manufacturing products we were looking for a new market for products.....

Drug companies will spend up to ten years doing research on a drug before they even sell one tablet....
And after ten years of research they may find that they will never sell even one tablet.....

Ask any Catholic if he is a christian..........ROTFLMAO... ...It is an insult to a catholic to call them a christian.......

Why would I listen to another moron?????

CurtiangrandpamiddTSQover wrote:

<quoted text>
I have been here all along Godfey, I just got tired of being accused constantly by "here is one" and most of the rest of you conservatives of being Middle of the road, grandpa, tsq,and just about every other liberal on here. That , at a time when the only name I used was "curtain rod" . I got tired of arguing that I was in fact NOT all those othr people, but that it wouldn't really make any difference if I was would it? Eventually I just decided there is no point in having one anonymous name I might as well change it with the wind. If I couldn't convince Here is one of how stupid it would be to change names all the time, I might as well play into his paranoia and change names constantly. What difference does it make? Does it matter who you are talking to?

As I said yesterday........LOL

Everyone knows you have a rod buried firmly in your arse by your every post......

Who else would claim that oslama sued Citibank as the president in 1994????

Who else would claim that the Mexican constitution is wrong and they understand the laws in Mexico better than all of the Mexican attorneys combined???

Who else would claim that the more than 400 ESL bilingual programs in California are illegal and then quote a law that only says one must simply request the ESL program..........LOL

GRANDPA NICOLAI wrote:

<quoted text>
>
>
Are you arguing that the egg came first...?
The only way you will ever make a profit is if your customers demand your products or service.
If there is great demand for whatever you offer and you are out to make money, your customers will FORCE you to hire more people,( you don't hire people out of the goodness of your heart) that is how customers create the jobs.
If you are a tightwad and do not want to hire any more people then the customers will FORCE someone else to hire more people to fill the demand for said products or services ... what is so hard to understand about that...?

So drug companies don't hire thousands of scientist to research on a drug for ten years and then find out that they will never sell even one tablet???
WRONG again.....LOL

Here Is One wrote:

<quoted text>

Why would I listen to another moron?????

>
>
Because he is a triple digit IQ moron and you are only a 2 digit IQ moron...

http://business.time.com/2012/05/18/was-nick-...