Uncertainty is a Wet Blanket on Job Creation

1. Uncertainty over the cost of the health care law (and the thousands of pages of regulations written to implement it).

For instance, six months ago, no one was writing about the huge administrative burden created by a section hidden away within the health care law that forces businesses to issue 1099 tax forms to any company they buy more than $600 of goods or services from in a year. Just to give you some scale, for my small business, this will include more than 1,000 companies. We will need to collect over 1,000 tax identification numbers and prepare and mail over 1,000 tax forms we did not have to prepare before the health care legislation became law. And, our active 17,000 customer accounts that buy over $600 per year will be sending us 1099's that we will need to keep, I suppose, or attach to our corporate tax return.

And, to what end are we going through these new administative burdens? The tax scofflaws are not going to be sending out a blizzard of 1099 forms. Only the companies who follow the law already are going to be doing this. So, what the health care law has done is create administrative work for law abiding corporate citizens who already pay their taxes.

There are other pitfalls that have not been uncovered yet (the bill itself is over 2,000 pages long and the regulations written to enforce it are many times as long already, and growing).

This is not insignificant. And, it is going on in lots of different places in our economy. Just ask any business person.

2. Uncertainty over the regulatory environment. Michael Aronstein used the phrase "regulatory totalitarianism" when talking about what is coming out of Washington these days and it really is very accurate. The rule of law is eroding and being replaced by the rule of bureaucrats.

3. Uncertainty over tax rates. When was the last time it was November and we still did not know what the tax rates were for the following year? That is what this Congress and this President have promised the American people. How easy is it to plan business investment and hiring when you don't know what a major component of your costs will be (36% federal rate on any income you can muster up in this economy). Tax rates matter, Mr. President. The longer they are uncertain, the lower the amount of business investment.

This is one area the current Administration just does not understand. Uncertainty is preventing business investment and job creation. This is what is happening in the real world, Mr. President.

Woldy

Abandon Ship, Gilligan!

Axelrod, Rahm, Larry, Peter . . . the list of Obama aides who have abandoned ship, or have announced plans to abandon ship is growing daily. They must sense that the second two years of Obama's term are not nearly going to be as much fun as the first two years . . . and they want to get while the getting is good.

Hard to read this any other way, in advance of the November Smackdown . . . I mean . . . Elections.

The Dems will see it as a victory if they hold onto the House, even if by a slim majority, but in reality, if they do manage to hold onto the House (not out of the question, anything can happen), it will be by a slim majority and that margin won't be enough to get anything done. Oh, and say goodnight to Nancy, because she is toast either way.

Recovery.gov

Someone asked the source of the data on job creation and the stimulus spending. Check out the above web site, then go to Illinois and put in your zip code. I just put in 60061, where my business is located. February '09 to June '10, there have been $15.6 Million in contracts let and grants given to recipients in this zip code.

Zero point one jobs created . . . personally, I find that hard to believe. What did they do with all that money? I have not noticed any helicopters overhead dropping it from the sky.

We are such suckers . . . PT Barnum was right.

Fast Stimulus Fact

Did you know that $169,000,000 in federal stimulus funding was spent in the 10th Congressional District (where I live) this year? Wow, that's a lot of taxpayer money.

Guess how many full time jobs were created by this incredible sum of money . . .

158

More than $1,000,000 per job. But, its even worse than that. So much of the stimulus was spent resurfacing roads in the 10th District that once the roads are resurfaced and the Government money runs out, those jobs are gone. So, we spent $1,000,000 per job, for a temporary full time job. Stunningly ineffective . . . But the roads are so smooth now . . . at least we've got that going for us.

If you care about fiscal sanity, vote GOP this Fall. Bob Dold in the 10th, Joel Pollak in the 9th.

Woldy