As the 2016 campaign progresses, it's worth taking a look at proposals to boost the American economy and to create jobs. We need to keep in mind who is for and who is against each of these proposals. Here's the first four:
1. Pacific trade agreement: It is undeniable that free trade increases economic growth. In fact, many economic historians blame the great depression of the 1930s on the high tariffs and anti-trade moves made in much of the developed world prior to the onset of that calamity. Without a doubt, free trade causes dislocations for some parts of the economy; those in inefficient industries become less able to compete with foreign companies, but those in the more efficient industries get vast new markets which allow them to grow rapidly. As of now, the Democrats are all against the Trans-Pacific Partnership agreement (even though they don't yet know the specific content of the agreement.) Among Republicans, Donald Trump opposes the agreement (he wants a better deal), and the others who have expressed an opinion are in favor of the agreement so long as it doesn't have inappropriate provisions when they are all disclosed.
2. The Keystone XL Pipeline: This pipeline will create 60,000 American construction jobs as it is built. It will also allow the addition of about an additional 1% to the world supply of oil, something that will keep oil prices lower for longer. The main complaint about the pipeline is that it will result in the burning of fossil fuels which will cause pollution. Of course, if the pipeline is not built across America, the Canadians will just send the oil to China where it will be burned without the stringent anti-pollutions measures of the USA. The net result will be more pollution worldwide. Hillary Clinton and Bernie Sanders are both against the pipeline. Every Republican who has expressed an opinion supports construction of the pipeline.
3. Raising the minimum wage: there is a big push among Democrats to raise the minimum wage across America. There is little dispute that such an increase will result in the replacement of many of the lowest paid jobs with automation. There will be more computer kiosks and fewer fast food workers. There will be more self service and fewer retail floor workers. Overall, there will be a pay increase for some and there will be many more who will lose the ability to gain entry level jobs. The Republicans have mixed views on this, but as a group they are not strongly for it.
4. Changes to business taxes: The USA has the highest tax rate for corporations in the developed world. This provides a major incentive for businesses to locate new activities in other countries and to transfer work from American workers to foreign plants. Reduction of the corporate tax rate would remove the incentive to ship jobs out of the USA. It would increase US economic growth. Every Republican who has announced a position on this issue is in favor of lowering the corporate tax rate in one way or another. Both Hillary Clinton and Bernie Sanders want to raise taxes on corporations, a move that would make the shipment of jobs out of the USA much more likely to continue.
1. Pacific trade agreement: It is undeniable that free trade increases economic growth. In fact, many economic historians blame the great depression of the 1930s on the high tariffs and anti-trade moves made in much of the developed world prior to the onset of that calamity. Without a doubt, free trade causes dislocations for some parts of the economy; those in inefficient industries become less able to compete with foreign companies, but those in the more efficient industries get vast new markets which allow them to grow rapidly. As of now, the Democrats are all against the Trans-Pacific Partnership agreement (even though they don't yet know the specific content of the agreement.) Among Republicans, Donald Trump opposes the agreement (he wants a better deal), and the others who have expressed an opinion are in favor of the agreement so long as it doesn't have inappropriate provisions when they are all disclosed.
2. The Keystone XL Pipeline: This pipeline will create 60,000 American construction jobs as it is built. It will also allow the addition of about an additional 1% to the world supply of oil, something that will keep oil prices lower for longer. The main complaint about the pipeline is that it will result in the burning of fossil fuels which will cause pollution. Of course, if the pipeline is not built across America, the Canadians will just send the oil to China where it will be burned without the stringent anti-pollutions measures of the USA. The net result will be more pollution worldwide. Hillary Clinton and Bernie Sanders are both against the pipeline. Every Republican who has expressed an opinion supports construction of the pipeline.
3. Raising the minimum wage: there is a big push among Democrats to raise the minimum wage across America. There is little dispute that such an increase will result in the replacement of many of the lowest paid jobs with automation. There will be more computer kiosks and fewer fast food workers. There will be more self service and fewer retail floor workers. Overall, there will be a pay increase for some and there will be many more who will lose the ability to gain entry level jobs. The Republicans have mixed views on this, but as a group they are not strongly for it.
4. Changes to business taxes: The USA has the highest tax rate for corporations in the developed world. This provides a major incentive for businesses to locate new activities in other countries and to transfer work from American workers to foreign plants. Reduction of the corporate tax rate would remove the incentive to ship jobs out of the USA. It would increase US economic growth. Every Republican who has announced a position on this issue is in favor of lowering the corporate tax rate in one way or another. Both Hillary Clinton and Bernie Sanders want to raise taxes on corporations, a move that would make the shipment of jobs out of the USA much more likely to continue.
No comments:
Post a Comment