General Discussion
Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsWho creates jobs? 1) people who earn good money for good work & 2) people who borrow money to spend.
Note that neither action requires the wealthy lift a finger... they might facilitate job growth by being able to finance large projects, but the law of supply and demand are in control. For each super-wealthy person that doesn't act, dozens of small-business owners will to meet the demand. Which is 100% driven by the people's ability to earn and borrow money.
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Fresh_Start
(11,330 posts)but that doesn't really help american's, does it?
EasyGirl
(89 posts)by entrepreneurs in a favorable business climate.
Xyzse
(8,217 posts)The definition of the Business Climate and what allows it to be favorable is what is in question.
How would I see "favorable business climate"
1 - A populace that can afford goods and services.
2 - A pool of workers that are educated enough for those jobs.
3 - Favorable legislation and governmenal aids through infrastructure and breaks.
So now, you also have to consider who to concentrate on to grow jobs.
Big Businesses/Established Companies - Subsidies and corporate welfare here should be cut, as they are already established and money acquired that they get back is not used for hiring or jobs. Job creation is a function of need and growth. A large scale business has limited growth potential other than outside the country. So, whatever money they get, tends to be used for investing, take overs, acquirement of property and off-shoring.
Small Businesses / Start Ups aged <1-3 years - Current levels of help seems sufficient. This is the area that is struggling to prove themselves, as most small businesses fail in their first year. As such, in regards to job growth, this is not the boom sector. This is the valley, the proving ground where a company will either succeed or fail. Keeping this in current levels of governmental assistance should be fine.
Small - Midsize Businesses / Aged 4-10 years - This is where most growth potential for jobs happens. These are the companies that are poised for growth and need to hire. I would concentrate here in regards to assistance.
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The general idea is that monopolies are needed initially to improve advancement, but monopolies should end because they limit advancement after a time. When a company starts and are at their mid point, that is when they grow and expand the most, by the time they are established, their focus changes and it goes towards protectionism of their interests which then limits the opportunities for start ups as they now have the leverage to try to squash things before anything else. So, because they are also big, their focus is not jobs but just replacement, so anything they do is limited and mostly towards profits.
EasyGirl
(89 posts)What if.......start up businesses with LESS than 5 people
would only have to pay 1/2 of exisiting corporate taxes for
2 years. I think that would be an incentive. Thoughts?
Xyzse
(8,217 posts)Last edited Fri Oct 12, 2012, 12:11 PM - Edit history (1)
A small start up like that, with say 1-5 people really needs help, especially since start up costs are high enough as is.
Setting up a business requires a lot of state related costs as well.
However, I wouldn't cut it to a half, just cut it by 1/4.
There is also a reason businesses can't be started just like that either.
There would be administrative costs(could be optimized).
Due to the cost, it actually forces those who want to start a business to think it through a bit more.
See some people shouldn't start things up without doing their research. It costs money even to close down the business.
Though yes, I think a tax break/incentives for the first year would do some good. Second year, I still think they need a proving ground.
Also, the costs of closing a business out needs to be considered. Things like this shouldn't be entered half-baked, and if the cost is low enough for some, they may end up hurting themselves far more through their failed business venture.
Another thing to consider, is what can be considered a small business. Hedgefunds should not be considered as part of this array. Those are not small businesses meant to expand.
EasyGirl
(89 posts)I was thinking of just the mom pop types of businesses.
I just realized I had to make that distinction.
I didn't know that some people claim that hedge funds are small businesses.
Like I said on my prior post, I kinda like the idea, but only for the year and start up costs.
I still think that small businesses needs to be thought through, and opening costs cut by half would make things a lot more affordable to make a gambling mistake on opening one.
I also think that if a business fails, there are closing business costs also, which feels like kicking someone while they are down. At least this is in regards to some states.
EasyGirl
(89 posts)new business must be intimidating. That's why I have respect for the common guy who say's "f____ it" and starts a business
and is able to hire people and be successful. Hat's off.
Kingofalldems
(38,461 posts)
abelenkpe
(9,933 posts)without customers every business fails. To have customers consumers/workers need a secure steady income with enough disposable income to afford the product or service.
reformist2
(9,841 posts)They may add to it once it gets started in what is usually called a "virtuous cycle" - but the truth is they actually accelerate the loss of demand during recessions when they fire people. So actually, most entrepreneurs are facilitators of economic trends, not drivers of them.
leftstreet
(36,109 posts)
Or wait, how about the National Health Service in the UK?
How many entrepreneurs did it take to launch the US Veterans Admin? Postal Service, Teachers...
EasyGirl
(89 posts)leftstreet
(36,109 posts)
lumberjack_jeff
(33,224 posts)Jobs are created by customers and ONLY customers.
If I buy a new car, I'm hiring welders, painters and mechanics to build it for me. The CEO of GM and its investors are only there to manage the labor and machinery to do it efficiently.
And entrepreneur doesn't create a job, they exploit a market demand, which occasionally requires labor to fulfill it.
EasyGirl
(89 posts)If an entrepeneur starts a new company and hires 10 people.
Hasn't he just created 10 real jobs?
lumberjack_jeff
(33,224 posts)If the entrepreneur has a shitty idea and the company can't sell it's stuff, the entrepreneur becomes the customer, and the demand was his search for profitable opportunity.
EasyGirl
(89 posts)leftstreet
(36,109 posts)Can you counter the statement that demand creates jobs with something other than opinion?
RedCloud
(9,230 posts)Without them we would all be mindless simpletons doing whatever the Koch brothers told us to do.
After that it is demand for products.
Egalitarian Thug
(12,448 posts)Just when did we become so detached from reality that we began fetishing businesspeople? As the owner of several small businesses over the years, thank you for your adulation, but really, if not for our customers none of us would go through this.
Whiskeytide
(4,461 posts)... "if not for our customers none of us would go through this." Its a two sided equation. Someone has to be willing to go through "it" to meet the demand, and in that sense an entrepreneur does help to create jobs by taking the risk and working hard to maintain a successful business.
I look at the phenomenon as: when demand creates an opportunity, and an entrepreneur seizes that opportunity - presto change o - jobs are created. Why does it have to be only one or the other?
Egalitarian Thug
(12,448 posts)and especially our economy, are never balanced. Since the 80's, when most Americans first heard the word entrepreneur, there has been a constant, concerted effort to raise our reputation far above what is deserved. You used two of the phrases yourself in your reply; Taking the risk and seizing the opportunity.
The ubiquitous term Risk Takers is a little truth covered over with a large coating of BS. An entrepreneur starts a business when (s)he finds an unmet demand. the customers that create that demand. Once the demand is recognized, the only real risk is that the demand will wane, or another entrepreneur will come in and meet it better or for less than you can. The whole entrepreneurial process is about reducing or eliminating risk, so the notion of being a risk taker is largely mythical. The whole "4 out 5 small businesses fail in the first year" or whatever it is they are selling these days may be true, but it almost always because of stupidity on the part of the owner, and that brings us to "seizing the opportunity". The term implies that there is something elusive or maybe dangerous about these opportunities, it's not wrong, but neither is it difficult.
The difference between a successful start up and a failure is almost always planning and resources. There are always exceptions, and there is always a lot of hard work and stupid-long hours, but the entrepreneur is the most easily replaced component in the whole process. And the process doesn't exist without the customer.
EasyGirl
(89 posts)Egalitarian Thug
(12,448 posts)EasyGirl
(89 posts)"An entrepreneur starts a business when (s)he finds an unmet demand. the customers that create that demand"
Silly examples, but to the point.
1. Hula hoop ? I didn't see anyone demanding them, until the
inventor "created" the demand. Same with pet rocks, those hats with the beer holders, and swamp people.
Egalitarian Thug
(12,448 posts)toys of all kinds were in great demand and (Hasbro, Mattel?) was scouring the country in search of products to meet that demand. The case of the Hula Hoop was not strictly an entrepreneurial endeavor in any case since the guy just sold it to an established manufacturer. There was never a "Hula-Hoop Inc.".
I've been at this a long time and I was taught by three men that came up during the depression. If you think about it in the context of the definition of entrepreneur, I think you will see that what I wrote is quite accurate. It was the entrepreneurs that were the economic engine of America and supplanting them with large corporations, and thereby becoming dependent on them, is the fundamental weakness that has brought us low. Even into the 90's small business employed the overwhelming number of Americans, it was only when we legislated our economy into the hands of Big Business that things went sideways. Big Business will always choose collusion over competition.
Still, it is not the individual SBOs that matter, there are always people wiling to try it. It's the customers that make it all possible. And while this President at least gives lip service to small business, the entire economic policy of our government for 40 years has been to favor Big Business over small business.
