General Discussion
Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsBusinessmen don't "create jobs"...
CUSTOMERS create jobs..
I get so sick of this crap.
No one EVER hired someone they didn't absolutely have to.
Facility Inspector
(615 posts)just appears magically out of the aether?
annabanana
(52,791 posts)is constructed commensurate with the need
Facility Inspector
(615 posts)has to create that infrastructure.
It isn't in binary opposition to need.
Businesses just don't happen.
lumberjack_jeff
(33,224 posts)He buys a bulldozer and dump truck (or more specifically he commissions workers to assemble them for him) and hires other people to build him a shop in which to put them.
It doesn't matter that he's handing checks to the contractor and John Deere Inc - they're only middle-men. He's actually buying labor from individual workers.
His first customers pay for the jobs "that the entrepreneur created".
No customers - no jobs. Period.
Hortensis
(58,785 posts)DEMAND requires purchasing power. Low wages equal low purchasing power, fewer jobs, fewer products, fewer companies and entrepreneures and their purchases, and fewer tax dollars collected and available even just to maintain. Economy in the toilet.
Reaganomics/supply-side economics is a PROVEN failure we're all living with now, including the billionaire uber class it created from a sacked nation.
yeoman6987
(14,449 posts)What party was congress during reagab's administratuon? The answer is disappointing especially the house.
Hortensis
(58,785 posts)Anyway, "reaganomics" refers to the conservative economic policies that BEGAN with Reagan's election, thus the name, and have continued up until -- well, they're still continuing, even though the left has been trying to change course for decades now. We'd have made far better progress in recent years as the damaging effects have become obvious to all, I believe, without the pernicious effects of Citizens United and similar decisions.
daleanime
(17,796 posts)with our tax dollars?
Trajan
(19,089 posts)We paid for those roadways and ports to be built ...
Just so you know, I'm going to ignore you, so don't bother replying to me ... I don't cotton to those who hold right wing opinions in DU ...
Throd
(7,208 posts)That is the basis of a civilized society ... We pay for that infrastructure in order to improve the lives of ALL citizens ...
B Calm
(28,762 posts)customers create jobs. Funny how republicans listen to right wing propaganda convincing them that it's rich people who create the jobs, when the opposite is the truth.
annabanana
(52,791 posts)hifiguy
(33,688 posts)for shit that nobody in their right mind actually needs. If they'd give it three seconds of thought they'd realize that.
I have a six-year old iPhone that I bought from a friend a couple of years ago when my old flip phone died.
It does everything I need and a zillion things I DON'T need. Why should I spend a dime on anything else that does even MORE useless shit?
We hyper-logical types on the spectrum are marketers' worst nightmares.
B Calm
(28,762 posts)Conservatives never could understand how wealth trickles up and not down.
HereSince1628
(36,063 posts)And if one is thinking about manipulating national economies, protection and support of capacity of consumers to consume is an important point of manipulation and a safety net for periods of unfavorable markets and/or bad business decision making.
But start-ups, and many expansions, require initial periods of high capitalization, and a dose of hope, that before the money runs out the vision and dream of the business activity will become "established" with sufficient revenue generation over costs to justify continuation of business activity.
That's as true for Joe's lawn service which only employs Joe as it is for Southwest Airlines that employs hundreds. Consequently, if you are wanting to expand jobs, it's also important to consider as points of economic manipulation things that influence the cost of start up and expansion.
That's particularly important if policy desires to promote expansion of a target sector, say solar or wind power, or if policy says 'we want a factory, hospital, or retail market "HERE". Then incentives that lead to favorable likelihoods of return on investment become very important to entice business relocation or expansion.
So, I see the problem of creating jobs as a rather more complex system of interacting parts than the producer-consumer relationship of simple and easily grasped economic models.
The tools that are used to approach these problems have to be diverse enough to fit the circumstance, and they have to be employed in a manner that recognizes good-things aren't the only possible outcome.
Regulatory and reparative services have to be constructed and maintained in parallel with innovative/exploitative decision making that seek asymmetrically favorable advantages (opportunities/loopholes/unexpected consequences) that arise within the complex interactions of economic agents and economic environments change.
smirkymonkey
(63,221 posts)lumberjack_jeff
(33,224 posts)"Job creator" is the most bullshit marketing ever.
Snobblevitch
(1,958 posts)B Calm
(28,762 posts)Snobblevitch
(1,958 posts)quite often there is a lag between hiring emPloyees and having paying customers. Plus, I know of businesses that haved hired employes because they needed a job, not because they needed another employee. The premise of the OP is not always the case. I wonder what was the reason to start this thread? Is this something to do with the recent debate?
B Calm
(28,762 posts)the product you are selling. Without the demand from customers, the business is doomed to fail.
The reason you start a business is that you expect to make a profit. You can either provide a good or service that caters to existing demand in the market or you can provide a unique, new, and novel product or service that attracts demand. If you have no customers, there is no demand and you go broke. Somewhere, somehow, you have to attract capital to begin the business and to carry the business through the ramp up in customer demand. If you can't get capital, you are just a wannabe entrepreneur (don't quit your day job).
B Calm
(28,762 posts)But, if there is no DEMAND (customers) for your product it's doomed and should have never opened to begin with.. Thus, the only ones creating jobs are consumers.
ProfessorGAC
(65,120 posts)You appear to have decided there is some fundamental difference because your semantics are altered.
The two points are exactly the same.
Facility Inspector
(615 posts)there was no demand for an iPhone until it was created.
starroute
(12,977 posts)And the CEO's of existing enterprises are destroying more jobs than they create. So how to you get the money to the new businesses that really need it?
http://www.forbes.com/sites/stevedenning/2014/10/29/the-surprising-truth-about-where-new-jobs-come-from/
The surprising truth is that over the last twenty five years, almost all of the private sector jobs have been created by businesses less than five years old. . . .
Both on average and for all but seven years between 1977 and 2005, existing firms are net job destroyers, write Wiens and Jackson, losing 1 million jobs net combined per year. By contrast, in their first year, new firms add an average of 3 million jobs.
New businesses account for nearly all net new job creation and almost 20 percent of gross job creation, whereas small businesses do not have a significant impact on job growth when age is accounted for.
Policymakers often think of small business as the employment engine of the economy. But when it comes to job-creating power, it is not the size of the business that matters as much as it is the age. New and young companies are the primary source of job creation in the American economy. Not only that, but these firms also contribute to economic dynamism by injecting competition into markets and spurring innovation.
lancer78
(1,495 posts)The tax rate is irrelevant when deciding to expand a business or not as most expenses are tax deductible (effective tax rate of 0). The only taxes that you have to pay more on to the government are payroll taxes and maybe property taxes. Want to reduce your tax liability, expand your business.
Major Nikon
(36,827 posts)An employee doing work is fulfilling a need for work. One exception might be they are getting paid to move a set of boxes from one side of the warehouse to the other and then move them back the next day. If that's the case then that employer is certainly a cow that's far afield from the herd and hardly worth mentioning. Most larger employers actively seek to reduce employees as much as possible as employee costs generally are the single largest expenditure.
Snobblevitch
(1,958 posts)and I certainly am in favor of emoyers treating employees in a fair manner.
I used to work for a small company that had 12 full-time employees. The company had ne debt. The owner was an old woman who had a lot of money. The GM was a great guy and figured out a way to give bonuses to the employees instead of just paying more federal and state taxes. When we had a good year, the employees all got four or five figure bonuses. As a new, part-time employee, I got a $2,000 year-eme bonus. Is this common? No, I am sure it is not. That GM, hired a young, single mother to do what we all thought was 'busy work' because she was recently widowed.
That was the best company I ever worked for. It's too bad it was sold. (The old lady owner lived for 25 more years after she sold it at age 73. Hell, I thought she was going to outlive me.)
Major Nikon
(36,827 posts)Your neighbors' spending is your income. That's how the economy works. The idea that employers are "job creators" is nothing more than a repackaging of the horse and sparrow theory.
Snobblevitch
(1,958 posts)Nothing happens until somebody sells something. There have to be buyers and sellers. The sellers take on more risk than the buyers.
I know there are companies with tax breaks they do not deserve. However, I get tired of the abuse heaped on small business owners. The employees think they are all rich and get that way only because of the employees.
Major Nikon
(36,827 posts)So it's not correct to say sellers are a required part of an economy.
None of this is all that relevant to the reality that we live in a demand driven economy, not a supply driven economy. The idea that we can lift all boats by heaping benefits on the rich is nothing more than a trojan horse used to prop up an oligarchy.
Snobblevitch
(1,958 posts)Of course we live in a demand driven economy. What about 'nothing happens until somebody sells something' did you miss? Barter has little to do with today's economy. I am not a supporter of bitcoin.
Major Nikon
(36,827 posts)Which I happen to agree. So either you are trying to contradict that point or not. If not you are going off on some tangent I could care less whether I miss or not. Just sayin'
Populist_Prole
(5,364 posts)I believe the supply-side/trickle-down dogma is the absolute root cause of the economic stagnation plaguing the working class over the past 35 years.
It was all just a pernicious orchestration to unravel the FDR new deal and the resulting economic ( and by extension, political ) power that the proles wielded following WW2 and through the 70s.
Throd
(7,208 posts)I will need to hire someone next year because the needs of our customers currently exceeds our ability to service them.
So yes, I am hiring somebody because I absolutely have to. I don't see this as some profound discovery.
cherokeeprogressive
(24,853 posts)Not sure where that leaves us.
starroute
(12,977 posts)They can take money out of the pockets of one percenters who will only sock it away in offshore accounts and hand it over to poor and middle class people who have more backed-up demand than they have cash to meet it.
philosslayer
(3,076 posts)However, when the Government expands, and hires people, it DOES create jobs.
StrongBad
(2,100 posts)Tell me more about your knowledge of economics, I'm intrigued.
B Calm
(28,762 posts)for their product is what creates new jobs.
upaloopa
(11,417 posts)It is like a wheel. Capital starts it spinning and demand keeps it spinning.
B Calm
(28,762 posts)their new product is not there, the only jobs created were temporary. It takes DEMAND to create new jobs.
upaloopa
(11,417 posts)annabanana
(52,791 posts)lumberjack_jeff
(33,224 posts)Money and businesses are simply devices to aggregate and coordinate that barter transaction.
When I buy a truck, I'm exchanging boatbuilding services for truckbuilding services through a network of middle-men and paper promises.
StrongBad
(2,100 posts)There was no demand before the product existed. They created the product, the demand and the associated jobs.
B Calm
(28,762 posts)StrongBad
(2,100 posts)B Calm
(28,762 posts)StrongBad
(2,100 posts)I think you lost your way in this exchange.
B Calm
(28,762 posts)no one has a job.
lumberjack_jeff
(33,224 posts)...all far predate the iphone.
Technology convergence isn't in any way novel. I had a watch with a calculator in 1980.
Businesses don't create demand, they exploit it.
StrongBad
(2,100 posts)lumberjack_jeff
(33,224 posts)Businesses identify and exploit demand by coordinating labor. Apple didn't build the Iphone, labor did. They didn't create the demand for it either - rising standards of living did.
StrongBad
(2,100 posts)Apple provided the capital, management and execution of resources to produce the iPhone.
Labor without direction and management is essentially useless.
lumberjack_jeff
(33,224 posts)Inherent in that definition is "value"="labor".
I build boats. I'm the sole shareholder in the LLC and since the people who make epoxy resin and plywood don't want to get paid in boats, capital is a convenient means of exchange.
Labor without capital might be cumbersome, but capital without labor is ENTIRELY useless.
The incidental nature of capital and capitalists is made manifest by the myriad forms this capital takes. Dollars? Euros? Bitcoins? Gold? BerkShares? Who gives a shit? The value of a currency is the amount of labor you can purchase with it.
StrongBad
(2,100 posts)lumberjack_jeff
(33,224 posts)It's all paper. People have a shared delusion that the dollar bill, promissory note, government bond or stock certificate have some inherent value other than the amount (and type) of labor you can purchase with it.
That's all it is.
Banks create money itself on-the-fly by promises of people to repay it. Those promises come from either individuals promising their labor, or businesses - in the form of profits they anticipate skimming off the top of labor.
StrongBad
(2,100 posts)lumberjack_jeff
(33,224 posts)Erose999
(5,624 posts)existed. Businesses and products don't create demand, they tap into existing demand.
StrongBad
(2,100 posts)...by organization and management of capital and labor (i.e. a business) is what allowed jobs to be created that satisfy that demand.
Erose999
(5,624 posts)owners and the wealthy.
StrongBad
(2,100 posts)B Calm
(28,762 posts)annabanana
(52,791 posts)It's like a blind spot
hifiguy
(33,688 posts)If they acknowledge that, their entire nonsense worldview falls like a house of cards in a hurricane.
They CAN'T admit that basic truth.
Facility Inspector
(615 posts)Hissyspit
(45,788 posts)Hissyspit
(45,788 posts)I remember driving down the road trying to navigate the Internet on my old Ericsson flip phone and imagining something along the lines of the iPhone a few years before it was marketed. I was ready to spend my money right then and there.
Congrats on losing the argument before you even got started.
olddots
(10,237 posts)Snarky little programmers will be replaced by programs soon .
Erich Bloodaxe BSN
(14,733 posts)And maybe frequently related to nepotism.
upaloopa
(11,417 posts)When you start a business you draw up a business plan. Especially if you are asking for loans.
In that plan you list the jobs needed to conduct business.
Before the first costumer comes in the door you have hired for those jobs.
For instance in retail you hire clerks, stock room employees and managers.
If you don't do well you close your doors and lay people off.
If you do well you had a good business plan and attracted customers and maybe hired more employees if demand for your products or services increased.
WDIM
(1,662 posts)Giving the middle and working class more money creates more demand and creates more jobs.
Giving the rich more money just creates wealth hoarding.
Piss on the poor economics of the repugs has been destroying jobs and wages for 30 plus years.
1939
(1,683 posts)You mean all of those rich folks just have a gigantic pile of greenbacks stuffed under their mattresses?
I think most of them have used their money to invest in existing companies, in startups, in state and local bonds which do create jobs. Even putting money in the bank, the bank either loans it out to businesses to expand or startup and to consumers to allow them to make a big ticket purchase (i.e. create an economic demand).
I keep my retirement savings in those places and not under my mattress.
hifiguy
(33,688 posts)Wealth hoarding is the biggest "business" on the planet.
To the tune of $32 trillion, yes, TRILLION dollars. $32,000,000,000,000. All stashed in various financial black holes around the planet.
http://www.huffingtonpost.com/2013/04/29/wealthy-stashing-offshore_n_3179139.html
http://www.reuters.com/article/2012/07/22/us-offshore-wealth-idUSBRE86L03U20120722
N.B. Real sources, not woo sources.
1939
(1,683 posts)Just sitting in a vault like Scrooge McDuck or is it being invested?
hifiguy
(33,688 posts)so no one else can get their hands on it, ever. So that the pigs can revel in how much better and richer than they are than the rest of the world, in self-satisfaction that they have stolen almost everything there is to steal, while we proletarians sink further into immiseration. It's nothing but.pure, rapacious, atavistic, solipsistic greed for its own sake. IOW concentrated evil.
lumberjack_jeff
(33,224 posts)Businesses don't buy equipment, expand operations or hire people unless they have to.
"Investors" reward managers who do buyouts, buybacks, layoffs and restructurings... i.e. "destroy jobs".
Higher top marginal tax rates are associated with hiring, actual business investment (e.g. equipment) and charitable donation. These are all activities that are promoted by a high top tax rate.
hifiguy
(33,688 posts)And impoverished masses create demand for nothing. But what amounts to slave labor is very, very good for the capitalist pig and very, very bad for everyone else.
And corporations have more than TWO TRILLION DOLLARS stashed in offshore financial black holes for the sole purposes of NOT investing it OR paying taxes on it.
Large-scale capitalism is exactly what Karl Marx described it as being and nothing more.
Nye Bevan
(25,406 posts)but someone needs to get off their ass and organize the production and marketing of the product and hire the people to make it happen. The woman who came up with Spanx, for example, who is now a billionaire; yes, the customers were out there for this product but nobody figured that out until she did.
See my post #79
taught_me_patience
(5,477 posts)I think that you might have a different opinion if you have.
lumberjack_jeff
(33,224 posts)smirkymonkey
(63,221 posts)has increased over the last few decades primarily due to this idea that giving more wealth to the 1% - the "job creators" - creates more wealth/jobs for all. It doesn't. From his article "The Pitchforks are Coming"...
"If we dont do something to fix the glaring inequities in this economy, the pitchforks are going to come for us. No society can sustain this kind of rising inequality. In fact, there is no example in human history where wealth accumulated like this and the pitchforks didnt eventually come out. You show me a highly unequal society, and I will show you a police state. Or an uprising. There are no counterexamples. None. Its not if, its when."
Many of us think were special because this is America. We think were immune to the same forces that started the Arab Springor the French and Russian revolutions, for that matter. I know you fellow .01%ers tend to dismiss this kind of argument; Ive had many of you tell me to my face Im completely bonkers. And yes, I know there are many of you who are convinced that because you saw a poor kid with an iPhone that one time, inequality is a fiction.
Read more: http://www.politico.com/magazine/story/2014/06/the-pitchforks-are-coming-for-us-plutocrats-108014#ixzz3q9qc3hnT
Trajan
(19,089 posts)Most likely to agree with ya ...
Throd
(7,208 posts)I am currently expanding a business. Trump is not my guy.
hifiguy
(33,688 posts)People who start small businesses are doing something necessary, valuable and worthwhile.
When any business becomes sufficiently large - where one wants to mark the dividing line would be an interesting question but I'd say somewhere around nine figures - it necessarily evolves into a thing with one goal - eating and growing, like a great white shark, by whatever means, fair or foul, that can be employed.
Businesses that large should either be broken up into manageable pieces or nationalized. If it cannot efficiently exist in any other way it should be regulated as tightly as possible, with serious jail time hanging over the heads of the execs for violations of the law, and the corporate charters of all large businesses hould be subject to a review process every 5-10 years. And dissolution/breakup/nationalization should always remain options. Period.
Nye Bevan
(25,406 posts)It generates over $250 million in annual revenue, after all.
So how would you break it up? Different companies producing apparel for different parts of the body?
https://en.m.wikipedia.org/wiki/Spanx
Throd
(7,208 posts)hifiguy
(33,688 posts)Depends in what a company produces -whether it is a functional necessity in modern society and how likely they are to exercise monopolistic or oligopolistic market power. Undergarments to make people look skinnier than they actually are seem not to fit, as it were, though it is possible that false advertising claims could be invoked against the end users in some cases. j/k
I'm a believer in this old-fashioned thing called antitrust law enforcement. As were both Roosevelts, Truman, JFK, and LBJ. Unfortunately it's now deader than the dodo even though the laws remain on the books. Clinton and Obama seem to have had zero interest in it, but then they're good corporatists and that kind of law enforcement is very, very bad for campaign contributions.
ibegurpard
(16,685 posts)That is vital to people's lives or to the fundamental functioning of the economy overall. Your analogy is shit.
Nye Bevan
(25,406 posts)The post I was responding to maintained that businesses should be nationalized or broken up when they get sufficiently large. I gave an example of such a business and asked how this would work in this particular case.
portlander23
(2,078 posts)Kilgore
(1,733 posts)Many years ago a worker was laid off.
She decided to give an idea a try and built a widget that complimented the product her former employer made. Nothing else like it existed and the consumer did not realize they needed it until they saw it.
She built the first batch on her kitchen table, and bought an ad in the back of a trade magazine. They sold well and she ended up hiring a folks as sales grew.
So who created the jobs? Without her initial idea, no jobs would exist. Without the consumers buying the product no jobs would exist.
It appears to me the partnership between the business owner AND the customer creates the job.
B Calm
(28,762 posts)Kilgore
(1,733 posts)The consumer can just conjure up products and systems using just their will. Rather intellectually dishonest position I would say.
It takes two to tango! It takes both chocolate and peanut butter to make a Reese's!
Damn, now I want chocolate!
B Calm
(28,762 posts)It would never get built.
(found some chocolate......life is good!)
B Calm
(28,762 posts)Kilgore
(1,733 posts)This is the exact argument I experienced many years ago in an economics class. It's circular similar to which came first, the chicken or the egg. If I recall correctly, the prof settled by stating the business owner gets satisfied by making a profit and the consumer gets satisfied by getting the product. Me thinks it's symbiotic.
(where the heck did I put the peanut butter?)
B Calm
(28,762 posts)just an idea.
Kilgore
(1,733 posts)OK, have chocolate, have peanut butter....I'm going to party!!!!!
annabanana
(52,791 posts)Kilgore
(1,733 posts)And so the circular argument wheel turns.
LittleBlue
(10,362 posts)For new products, demand must be created and maintained with advertising.
So yeah, for things like food and other commodity-like products, that's true. For items like the iPhone, that was a masterclass in design and marketing by a visionary businessman.
Markets aren't just maintained by consumers, they are often created by business people. We shouldn't confuse crony capitalism with innovative capitalism.
HughBeaumont
(24,461 posts)Can someone sweep the Austrian School back to the Von Mises Institute, please . . . where they belong?
I didn't know Supply-Siders warranted any merit here. Usually we go to the rest of the internets if we want hilarious defenses of Dead Reagan Fail.
Oh wait, I forgot. The Thomas Sowell set thinks "Supply Side" is just something the LIBS made up "when tehy really meen 'cronyism'".
MisterP
(23,730 posts)demanded to keep its Diet elected by 0.4% of its population
had Vittorio Veneto not been a total slaughter Karl would've had them against the wall at war's end
Nye Bevan
(25,406 posts)If you did, and they were not hidden (which apparently they weren't) then yes, "libertarians" (at least by your definition) are, indeed, welcome here.
HughBeaumont
(24,461 posts)You know, seeing as how Supply Siders and Libertarians now have a home for their Dead Reagan Fail and their logical bollocks. We're apparently allowing long discredited horseshit on a Democratic/progressive message board now, so where's the need to alert?
And it's not by MY definition, but a definition comprised of said member's previous posts on economic matters that reveal less-than-even-moderate positions. By their words shall they be revealed, and all that.
Conservative horseshit doesn't belong on a progressive board. Bottom line.