beachmouse
Beach Fanatic
Okay, how has excessive government spending killed jobs over the past five years? In just about every case, governments have consistently cut actual tax rates with the increase in revenue coming from quantifiable economic growth.
Thing is, I'm not sold on the idea that broad spectrum tax cuts are the answer to creating large numbers of quantifiable new jobs in Florida. Okay, small business X saves $5K in taxes in the next fiscal year. This is not enough to directly hire a full time employee. So to claim the tax savings create job growth, you have to delve into indirect routes and multipliers. If the business owner decides to use that $5K to beef up reserve funds, you're effectively not getting job growth from it. If they take the profits and go on vacation out of state, they're not benefiting Florida's employment situation.
Okay, they're going to put those savings back into their businesses. Do they do so by altering inventory? Where does that new inventory come from? Do many hands in Florida touch that inventory along the way, or do they order directly from an out of state or international vendor? Unless they're ordering through Florida vendors, the state doesn't get the benefit of that multiplier involved.
Do they physically expand? (okay, for $5k, you're probably talking minor structural alterations) When they order construction supplies, how much of that money stays in Florida? (insert the statistics about how much money stays in the community if you order your drywall from a local building supply store instead of Home Depot) And how much of that $5K will go to construction workers, preferably of the legally able to work in Florida sort? And how many of those $5K projects does it take in order for Joe Construction Wroker to make a modest $25K a year and be considered to be fully employed?
How much does the state lose in tax revenue to create one full time job with broad-based tax cuts? And does this compensate for the loss of a state employee who spends their salary largely within the state of Florida, generating multipliers of their own? I suspect it's a heckava lot more than what you lose when you have targeted tax cuts to businesses who can prove they're going to add jobs to the system because of those targeted tax breaks and abatements. Every state already does those kinds of deals; Alabama does them sublimely- look at all the high wage auto jobs the state has drawn by taking that targeted approach rather than going broad-based.
I know some will say 'well then the gub'mint is picking winners and losers' but if you look at how those programs typically operate, if you have a good idea and what seems like a workable business plan, then you're typically going to get some serious tax releief as well as additional infrastructure assistance. (see Scripps Research)
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