How Not to Create Jobs

With unemployment at a 26-year-high, jobs have now replaced home ownership as the statistical benchmark by which politicians are measured. The president mentioned jobs more than 20 times during the State of the Union, and elected officials from both parties are readying a battery of proposals from cutting taxes to expanding TARP all designed to spur hiring.

One of the most frightening comes from Rep. Dennis J. Kucinich (D., Ohio), who last week teased the media with his plan to Create One Million Permanent Job Opportunities. With large companies like Verizon and Sam s Club laying off thousands of workers, how is that possible?

Kucinich s scheme involves temporarily reducing the age to receive Social Security from 62 to 60, which would let an estimated four million people leave their jobs and begin collecting early benefits. Younger workers who are currently unemployed would then be able to take those jobs.

Congressman Kucinich falls prey to the fixed pie fallacy, falsely believing that there are a limited number of jobs available and that it s his role as an elected official to allocate and distribute them as he thinks most appropriate.

These are not temporary jobs but permanent jobs that already exist in our economy even under the current recessionary circumstances," said Kucinich, implying that, along with income, health care, natural resources and housing, these permanent jobs are the government s responsibly to pass out.

The real intent, it would appear, is to enlarge our dependency on the government even amid a record deficit and burgeoning entitlement state.

Indeed, the congressman called for expanding Social Security to younger workers even before the economy collapsed. In 2003, he argued: We need to reclaim the benefits of quality life extension for our seniors by reclaiming Social Security benefits at age 65. America can afford it. Social Security s finances are more secure than ever. For Kucinich, there s never a bad time to expand the entitlement state.

My plan enables older workers to take early retirement, thereby freeing up those jobs for younger workers who are currently unemployed, he explains. It s a nauseating philosophy that likens U.S. workers to barnyard animals. If one mule breaks his leg, another one can simply be saddled in his stead.

now a unit of Yum! Brands) until he was 65 years old. Jack Welch successfully managed General Electric well into his 60s. Kucinich seems to imply that the country would have been better served if these industry titans had closed up shop and played Mah-Jong and waited for their checks from the government so that younger workers could have filled those jobs.

What s most surreal is Kucinich s economic justification. The cost to the federal government of the expanded early retirement option would be less than $15 billion paid for entirely by money already appropriated to deal with the financial crisis, he proclaims.

Only in government do jobs cost money. In a capitalist economy, jobs don t consume wealth -- they create it. Google's recent fourth-quarter earnings report indicated the company now generates approximately $1.3 million a year in revenue per each employee. Even less-successful Yahoo! rakes in $512,000 in revenue a year for every worker. That s money that s earned by providing a value, not simply being appropriated by force and redistributed by Uncle Sam. Kucinich s suggestion that jobs cost money is antithetical to the wealth a productive job is actually supposed to create.

In reality, his sullen plan to create jobs creates nothing at all. It irrevocably harms the economy by incentivizing people to stop being productive while further enlarging an entitlement state and solidifying his role as the anointed emperor passing out the permanent jobs in the fashion he and other bureaucrats believe to be most fair.

The one bright side? Under the plan, Kucinich, now age 64, would be eligible for early retirement. And if you believe that a country s economy is only as strong as the philosophy that leads it, his exit would unquestionably have a positive effect.

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