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Obama to speak @ 1pm EDT

PhDeac said:
Nope. I entered college with a specific idea of what I wanted to do for a living and worked toward it. Now I make good money doing exactly what I want to do in a sector that's relatively safe in down times. I don't make Wake money, but I do well to provide for my family and I actually have time to spend with them.
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In other words, you have no idea how business works and you'd prefer the status quo to anything that might actually encourage more deployment of private capital.

How does deployment of capital create jobs? Did you honestly just ask that question?
 
DeacMan said:
In other words, you have no idea how business works and you'd prefer the status quo to anything that might actually encourage more deployment of private capital.

How does deployment of capital create jobs? Did you honestly just ask that question?
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Yes, because the capital is already there and they're not creating jobs. What incentive is there for corporations to spend revenue on jobs?

I know enough about business to know that smart business people will create jobs when there is a need to do so. They have the money without the need. More money without the need isn't going to magically create jobs.

In order to create a job, investing money in an American worker has to lead to more profits than investing that money elsewhere. What would you do to make that happen?
 
Milhouse said:
interesting. none of your posts support that
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Question for you. I'm just a dumb professor, not a smart intelligent business man.

Compared to 10, 20, 50 years ago, how much of BOA/Citi/Wells Fargo/etc business is derived from local operations (small loans, mortgages, car loans, etc) compared to global financial services?
 
i don't have any idea.

i know that more than 10,000 people in charlotte work for BoA. who cares where the business comes from if people in charlotte are hired to support that business.
 
PhDeac said:
Yes, because the capital is already there and they're not creating jobs. What incentive is there for corporations to spend revenue on jobs?

I know enough about business to know that smart business people will create jobs when there is a need to do so. They have the money without the need. More money without the need isn't going to magically create jobs.

In order to create a job, investing money in an American worker has to lead to more profits than investing that money elsewhere. What would you do to make that happen?
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THIS IS A SILLY EXAMPLE. IT IS NOT DESIGNED TO BE "REAL". BUT IT IS ILLUSTRATIVE OF HOW INCENTIVES CAN SPARK MORE DEMAND HERE AT HOME.

Let's say that I have 1,000 USD sitting in the bank in Italy. Let's say I have a need in department X that is going unfulfilled because I don't have sufficient capital here in the United States to fill the need (sufficient being real or perceived on my part). I need $600 to fill the need. Now let's say that the rate for me to return that money from my Italian subsidiary via a dividend to my U.S. company is 30%. I'm still not inclined to bring the money back. So I don't do it. Now let's say the government lowers the rate to 10 percent. So I decide to bring the money back.

The government gets $100 it otherwise would not have received. I go out and spend $600 on a new copier (sales tax and all). To fulfill RJ's worst fear I spend the remaining $300 on executive bonuses because I work for a greedy and evil company. They in turn pay taxes on those bonuses and spend some of the remainder in local restaurants.

Wahlah, $1,000 that otherwise would not have been returned to the U.S. results in money going to the government and the local economy.

Let's say I want to build an ethonal plant (which apparently sucks) in Iowa. I can't make the numbers work sufficiently to get the project off the ground to attract the necessary private investment. But the state and/or the Federal government offer me some tax breaks. I now am in a position to line up the private investment needed to launch the project. I have to hire lots of workers to build and run the plant. Again, the activity would not have occured without the incentive being provided. In turn, jobs would not be created and more demand would not flow through the economy.

The idea is to spark demand by putting capital that otherwise is not in a position to be deployed into a position where someone will, in fact, deploy it. Pick your idea. I merely offered examples, not ringing endorsements.

Honestly, I think some of you would rather eat your own young than see the government offer an incentive to the private sector.
 
I, too, am trying to figure out why companies that are reporting record earnings need to be incentiveized to hire DeacMan. Balance sheets are terrific for American corps right now. stellar. Money is not a problem for these corps, they have reduced their workforces and are running lean. No need to hire until demand picks up.

The initial loss American jobs in the crash were in housing, construction, real estate. The losses of those jobs lead to weaker tax revenues, which lead to public sector cuts - thus creating weaker consumer spending - which lead to fewer profits for retailers and more layoffs, and so on.
 
PhDeac said:
Yes, because the capital is already there and they're not creating jobs. What incentive is there for corporations to spend revenue on jobs?

I know enough about business to know that smart business people will create jobs when there is a need to do so. They have the money without the need. More money without the need isn't going to magically create jobs.

In order to create a job, investing money in an American worker has to lead to more profits than investing that money elsewhere. What would you do to make that happen?
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This is also a falacy. Smart business people still take risk. Not every business will be successful. Business people are always measuring how a dollar deployed on a business idea is prone to provide a rate of return against what deploying the money elsewhere (i.e. sticking it in the bank) may derive for them. If they are incented appropriately, that rate of return can increase enough to the point that taking the risk becomes more appealing.

Some will still succeed, some will still fail.
 
bobknightfan said:
It's easy to see where you are going with that question....but when a 72-year old candidate picks Sarah Palin to run with him and potentially be one heartbeat from the presidency, it kind of shoots that argument out of the water, now, doesn't it?
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And this as well.
 
Bake, DeacMan won't address either of these issues:

1. Why the government should subsidize the most progfitable companies the world has ever seen?

2. Why there should be a tax holiday to repatriate capital without any strings attached given the last this was done jobs were LOST not created by the companies who repratiriated the money?
 
DeacMan, in your example, you have a capital problem and demand isn't an issue.

What seems to be the reality now is that you would have the money to get the project off the ground, but private investors would be worried about the demand for ethanol (or whatever product you're selling).

Again, you're not addressing the problem that if it were wise to hire somebody in the current environment, they'd be doing it. You even pull out the old "I disagree with you but I'll say the same thing you did" trick to make your point. I'm saying that giving out coupons isn't going to lead to sustainable growth if the market for the product isn't there to support it. Heck, I could imagine corporations turning down such incentives is they come with the necessary strings to coax employment. Like WakeandBake said, they're lean and mean. Why should the government try to "incent" the private sector to be less efficient and more dependent on the government?
 
PhDeac said:
DeacMan, in your example, you have a capital problem and demand isn't an issue.

What seems to be the reality now is that you would have the money to get the project off the ground, but private investors would be worried about the demand for ethanol (or whatever product you're selling).

Again, you're not addressing the problem that if it were wise to hire somebody in the current environment, they'd be doing it. You even pull out the old "I disagree with you but I'll say the same thing you did" trick to make your point. I'm saying that giving out coupons isn't going to lead to sustainable growth if the market for the product isn't there to support it. Heck, I could imagine corporations turning down such incentives is they come with the necessary strings to coax employment. Like WakeandBake said, they're lean and mean. Why should the government try to "incent" the private sector to be less efficient and more dependent on the government?
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Ph -

You make decisions far too simple. It isn't how things work in the real world. Again, businesses measure risk against reward. Those perceptions can change significantly based on any number of factors. And you are kidding yourself if you think incentives are not one of them. Every business potentially impacted by an incentive will measure its worth independently. This isn't an on off switch, Ph. You can perceive a need and still not believe it should be fulfilled. And that perception can change as external factors shift. So yes, I still think you are wrong. Further, you are demonstrating you have no business experience whatsoever.

Here's a real world example. I have a neighbor who wants to develop a five story apartment building in our neighborhood. He is up against some significant NIMBY opposition - not totally unfounded - that five stories would look out of place in the spot where he wants to build. They want him to build a three story building without getting a zoning variance. He will abandon the project if it can't be five stories. Millions of dollars in development are at stake at the city zoning commission. Many of the NIMBY's actually think he will still move ahead at three stories despite him telling them the project won't make economic sense and that he won't be able to raise the needed capital to get the thing built. Should he get the necessary variance? What should the local government do? Should they give him the incentive (i.e. the variance)? He sees a need for a five story complex. He won't build a three story complex. In your way of thinking the three strory should be a no brainer. Afterall, there's a need for a five story building in his mind.
 
Since DeacMan won't respond to either Bake or me, here's a question:

If the most profitable companies in the history of the world should be incentivized to do what those companies sare supposed to do, shouldn't EVERY company be given direct government dollars?
 
Lots of developed countries use a territorial tax system where you are only taxed on the income you earn in the country. Lowering the repatriation dividend rate is a way of setting up a hybrid system.
 
Below.
DeacMan said:
Ph -

You make decisions far too simple. It isn't how things work in the real world. Again, businesses measure risk against reward. Those perceptions can change significantly based on any number of factors. And you are kidding yourself if you think incentives are not one of them. Every business potentially impacted by an incentive will measure its worth independently. This isn't an on off switch, Ph. You can perceive a need and still not believe it should be fulfilled. And that perception can change as external factors shift. So yes, I still think you are wrong. Further, you are demonstrating you have no business experience whatsoever.

You're being demeaning for no reason because you completely misread my point. I already said up front that businesses measure risk vs. reward and of course they take incentives into consideration. My point is that tweaking the rewards without addressing risk is just artificial. We're having a conversation about what's best for the country, not what's best for the individual businessman getting a break.

Here's a real world example. I have a neighbor who wants to develop a five story apartment building in our neighborhood. He is up against some significant NIMBY opposition - not totally unfounded - that five stories would look out of place in the spot where he wants to build. They want him to build a three story building without getting a zoning variance. He will abandon the project if it can't be five stories. Millions of dollars in development are at stake at the city zoning commission. Many of the NIMBY's actually think he will still move ahead at three stories despite him telling them the project won't make economic sense and that he won't be able to raise the needed capital to get the thing built. Should he get the necessary variance? What should the local government do? Should they give him the incentive (i.e. the variance)? He sees a need for a five story complex. He won't build a three story complex. In your way of thinking the three strory should be a no brainer. Afterall, there's a need for a five story building in his mind.

I haven't said anything about local incentives. Whether or not a guy can fill a five story building is different from the federal government using incentives to boost reward and mask risks in a global marketplace to try to boost the domestic workforce.

Sure I may buy a certain brand of an item in the store if I am incentized to do so with a sale. Will I buy the same item without a sale? Do you incentives become permanent?

And you didn't address my point about the negatives of trying to encourage private industry to depend on the government for incentives rather than assessing the market and acting accordingly.
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PhDeac said:
In order to create a job, investing money in an American worker has to lead to more profits than investing that money elsewhere. What would you do to make that happen?
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This seems to presume that every business (a) wants to expand overseas, (b) has the capacity to do so effectively, and (c) has the human and capital resources needed to do so effectively. It also presumes that even if they had all of those things they would not seek out growth here as well.

Given the millions of potential factual permutations real businesses actually face, I'm going to go out on a limb and say generally there is plenty of opportunity here at home that can still be exploited.
 
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