I thought it might be worthwhile to sort out some of the bumbling, blathering nonsense related to manufacturing flowing from the President and President wannabes.
Taxing the Rich
The Democrats think the rich are getting too rich and should pony up more in the way of taxes. Republicans say the rich are the job creators and taxing them will kill the goose that lays golden eggs (although in light of the unemployment rate it doesn't seem as though they have been laying too many eggs of late). It turns out a couple of guys named Bakila, Cole and Heim, who seem to have no shortage of time and taxpayer money on their hands, studied the matter ad nauseum, and issued a mind-numbing report on it, at least as the data existed through 2006.
I went through the data and sorted it out, putting the rich folks into three categories: Leeches, consisting primarily of financial sector people, lawyers, government employees and realtors; Techies, consisting of engineers, scientists, doctors and professors; Job Creators, mostly made up of farmers and people running non-financial private sector companies. I tossed out the rest – less than 10% made up of artists, athletes, assorted oddballs and dead people who somehow are managing to pull down a healthy income from the grave.
I know that the groupings are not very clean and wholly arbitrary but I did the best I could with what I had. The case can be made that real estate folks who are actually building things create jobs, rather than simply flipping property the value of which is entirely the product of the sweat of someone else's brow; and private sector Job Creators include all sorts of dubious enterprises. I don't think greater clarity around the edges will change the conclusion much, however. Here's what it shows:
That the rich are getting richer is true. In 1979 the top 1% of the income earners raked in 9.2% of the nation's total income. By 2006 the top 1% were pulling in 16.2% of all the payroll dough. The folks who create jobs are still the biggest winners, but less so than they used to be. The folks who saw the real improvement – going from fithy rich to stinkin', filthy rich at the greatest rate – were in the Leech category.
Seems to me when Republicans and Democrats over-simplify the issue the whole 'baby and the bathwater' thing kicks in. Raising the tax rates on job ceators is a singularly bad idea, but most of the politicians aren't smart enough to understand the difference between a leech on American business and the people who actually drive it. They only see this confusing blur of people who don't work for the government, and they all kinda look the same. Mitt Romney, for example, who is a pure, dyed in the wool leech, is lumped into the same category as Herman Cain, a Job Creator – both just 'business guys' in the minds of the average politician or Fox News mouthpiece.
The problem is that the average taxpayer agrees that the leeches should be taxed to the max – take it all, in fact, is how most of them feel. Job Creators, on the other hand should be left alone. Liberals just plain don't like rich folks, whether they create jobs or not – except of course for the oddballs from the entertainment and sports world I excluded. Liberals love them because, well, most of the oddballs are liberals and put their wealth into liberal causes.
Mr Obama has been hard to read when it comes to his view of manufacturing. Some of that is because community activists generally don't understand manufacturing in the least – or have much respect for it. Some of it is because he is a big believer in the more outrageous environmental philosophies and is generally an anti-business liberal at heart. Mostly, though, the mixed signals are the result of the fact that, more than anything else, he is a Chicago politician, which means everything he controls from the White House is for sale.
I suggest that if you go back and ponder where the TARP and stimulus money went, the whole GM bailout and takeover, the Boeing-NLRB debacle, read this article from the Washington Post – a 'news' source that is about as pro-Obama as it gets, and try to make sense of his $500 million robots and other high tech boondoggle, you will see what I see … that Obama's industrial policy has a certain logic and consitency:
The proof of my theory is this: Just about all Evolving Excellence readers are involved in manufacturing in some manner or another. Just about all of you are in the great big red zone – non-union, not Star Wars high tech. How many of you are sitting around the break room at work telling each other, "I sure wish the government would borrow some money from China and build me a robot – and, better yet, get me some union guys to run the robot. Then our business would really boom."?