With much fanfare from the media and the DFL’s press-release bloggers (most of them), the Dayton Administration released its “jobs plan”.
Call it “porkulus with a side of lefse“. It’s a dumb plan – and there’s language in here that shows the DFL knows it (emphasis added):
Saint Paul – Governor Mark Dayton and DFL Legislators together today announced a plan that if passed by the legislature, will put thousands of Minnesotans back to work this year.
And there’s the tell. This “plan” – more below – will come to the legislature bundled with some of the other nonsense Governor Dayton couldn’t get through the GOP-controlled legislature last session. The legislature will toss it. The DFL/media (ptr),the Strib editorial board and the chanting point bots will say “The GOP took your jerbs!” in November.
This plan is intended for no more.
To encourage businesses to hire new employees, Governor Dayton and the DFL Legislators propose offering a New Jobs Tax Credit. This would be a one-time $3,000 tax credit to any Minnesota business for each veteran, unemployed worker or recent graduate they hire during calendar year 2012, and a $1,500 credit for each new hire through June 2013. This $35 million program would create over 10,000 new, private-sector jobs this year.
Which is a great way to create a bunch of low-wage temporary jobs.
Business owners, I’d love to hear from you. $3,000 is better than a kick in the teeth. But given the other uncertainties in the economy.- Obamacare and the coming tax hikes and all the other regulatory nonsense that’s been pecking you to death and all the rest that’s looming in the next two years, not to mention Minnesota’s already-miserable business taxes – isn’t it more like whizzing in the wind?
Like- a chanting point?
It’s a sign that the DFL has learned one lesson – sort of. They’ve learned that “eat the rich”, in and of itself, isn’t a strategy for a session. They have to put a meaningless veneer of “job creation” on top of it.
Other proposals in the plan include a new bonding bill with details to be announced next week, a proposal that will help Minnesota compete for business expansion through the Minnesota Investment Fund, an expansion of the FastTRAC program to provide career-specific training to prepare adults for the jobs of the future and the creation of the Minnesota Opportunity Grants Pilot Program which will help Minnesotans get the training required for high-demand careers.
Read: a) Construction jobs for Dayton’s union backers, b) spending to try to convince businesses that the tax climate isn’t so bad, and c/d) more spending that benefits Dayton’s supporters in the education industry, coupled with platitudes, as if government has ever successfully predicted about what anything will be tomorrow.
Dayton:
“From day one, my top priority has been to get Minnesota working again.
No, Governor Dayton. With all due respect, from day one, your priority has been to do what the Alliance for a Better Minnesota, Win Minnesota,and the unions have told you to do. Last year, they told you to Eat The Rich. Class warfare bombed.
With that out of the way…
Our jobs plan will help businesses create good jobs for thousands of Minnesotans who are looking for work.
No, it won’t. It’s of little value alive – at $3K credit is bupkes – but of value as a wedge issue dead. Which is why you have your chanting-point bots yapping so hard about it now.
We need to focus on what we know will work: investing in infrastructure, providing incentives to private sector businesses to create more jobs, and training workers for high-demand careers.
Again with the code words.
Look- if you slash business taxes and cut regulations, the economy improves. Revenue booms based on economic activity. Then you build the infrastructure. Then you needn’t worry about training, because companies will train their own workers,on their own dime (although they’re happy to let the state pay for it, too). That is the only “incentive” you need.
And it’s the one the GOP’s been talking all along.
And it’d hardly do to campaign on that, if you’re the DFL,now – would it?
The important part, of course, is preventing Minnesotans from getting fooled by this Potemkin plan.
You should check out the linked PDF: http://mn.gov/_live/governor/images/Jobs-Proposal.pdf
This tax is leveled not on Amazon, but on the Minnesota consumer.
Wow.You’re right – I should have.
More tomorrow.
Offering a $3000 tax credit is reminiscent of the “cash for clunkers” program that produced a spike in car sales followed by a drop off later, to say nothing of destroying a lot of really good autos that could have been sold to private parties for reasonable prices. Overall, nothing changed. Unless Dayton’s plan somehow prevents employers from dumping their new hires once they’ve cashed the government checks, long term employment won’t change. I think it costs a business a lot more than $3K to hire a new employee for a year. The plan is just a poison pill for the legislature to swallow. They ought not to pass it and then spell out the reasons why.
When I saw this dog & pony show on KARE11 last night, they wrapped up with a very quick “the governor will pay for this with an increased tax on the rich”. (paraphrased)
The unemployment rate in MN is 5.9%:
http://www.google.com/publicdata/explore?ds=z1ebjpgk2654c1_&met_y=unemployment_rate&idim=state:ST270000&fdim_y=seasonality:S&dl=en&hl=en&q=minnesota+unemployment
There is some interesting data there. The number of employed Minnesotans hasn’t changed much since the days of 4.9% unemployment, but the workforce has grown.
The unemployment rate in my county (Hawaii County) is 10%. Back in 2006 it was less than 3%. Being on an island sucks if you have no job — it’s much more difficult to relocate to find work. That works against employers when times are booming.
You’ve got to hand it to the DFL-Alliance for a Bitter Minnesota -PTR Media Complex. No matter how old and busted their theory, they keep persisting with their mantra – “we’ll just tax the rich more, that will fix our revenue problem”. In the face of the rich either reducing their taxable income or just plain heading for the exits.
Case in point: Governor Moonbeam in Cali is pitching a 2% increase on incomes greater than 500K. This would take their already highest in the nation top rate 2 points higher. Funny thing has happened. The number of individuals in Cali making more then 500K has decreased dramatically (from 146,221 in 2009 to 98,610 in 2011). I’m not worried about Minneapolis turning into a cold Omaha. I am worried about Minnesota turning into a cold Greece.
http://mobile.bloomberg.com/news/2012-01-11/california-s-top-earners-dwindling-as-brown-counts-on-their-higher-taxes?category=%2Fleaders%2F
Apparently the new definition of “rich” in Minnesota is anyone who buys anything online from out-of-State. I don’t make enough purchases during the year that I really notice sales taxes but when I do think about it, I try to make a conscious decision to avoid paying any “additional” sales taxes (like the kind that get added on by local governments to pay for sports stadiums). The way I see it, buying online is really a form of voting with your pocketbook – I’d rather pay the shipping costs (which are often about as much as a sales tax) and help support someone in the transportation industry than continue to feed the beast in Saint Paul and Minneapolis.
“We need to focus on what we know will work: investing in infrastructure, providing incentives to private sector businesses to create more jobs, and training workers for high-demand careers.”
Two parts:
(1) “We need to focus on what we know will work”
Yay, the Governor get’s this part of the solution right!
(2) “investing” in big government boondoggles, pretending we believe in market “incentives” in a most pathetic way, provide “training” for jobs that won’t be there if our policies are accepted.
Boo, the Governor was just joking about wanting to put people back to work!
Not that I have to tell you guys this, but a one-time tax credit like this is meaningless for most employers. They will hire someone if the long-term prospects appear to make it worithwhile.
Is it worth getting $1500-3000 tax credit to hire someone? No. That is peanuts. I worked for a company that outsourced a number of jobs to India. They spent……I think it was around $75,000 per person who was fired due to the outsourcing (severence pmt, subsidized insurance after firing, training period for India, placement contracts to assist released employees).
They felt is was worth spending $75K per employee to send their job to India. I doubt getting $3000 from the gov’t will encorage them to bring jobs back here.
My point being is…..just create an overall pro-business enviroment. Don’t do special targeted one-time handouts.
What else? Get the lawsuits and mandates under control.
Terry said:
“This tax is leveled not on Amazon, but on the Minnesota consumer.”
The customer always “gets it” in the end.
Here’s a link on the topic and a quote for those who think a “jobs bill” should include an “internet tax”.
http://online.wsj.com/article/SB10001424053111904772304576468753564916130.html
“Several chain retailers, including bookstore Borders Group Inc., have also tried not to charge sales tax online, but were blocked. Borders argued that its Web operation was separate from its stores, but a California court in 2005 rejected the argument, ruling the two were intertwined. A spokeswoman for Borders, which faces bankruptcy liquidation, declined to comment.”
More taxes, more dead companies.
Yeah, they never seem to do it the other way around, Troy, and even the playing field by eliminating sales taxes for local retailers.
I think Cali may be entering a death spiral. It’s real GDP growth has been lagging behind the 50 states for the last decade. They can’t grow GDP faster unless they cut entitlements & taxes, but the political system is setup to avoid this kind of pain.
Adam Smith pointed out that countries with flat or negative growth are miserable places to live. You can’t thrive there. Even with a flat GDP you make the easiest marginal gains first, so every year you work harder just to stay in the same place.
And of course in those countries with a flat or shrinking GDP, the rich still do all right. It’s the poor and middle class that suffer the most.
Let’s see, the Governor wants a 775 million dollar bonding bill. O.K. The state capitol needs 241 million dollars worth of updates to which the Governor says: “The time is now. The building has significant problems that must be addressed. It is our responsibility to do so as stewards. We can no longer put this off to future generations.” But there is no money allocated for the renovation to the Capitol in the Governor’s bonding bill. He hopes that the Legislature will consider at least part of the project this session.
It has to be done now, but I’m not proposing any money for it? Maybe the Legislature will deal with it. What, and add 241 million to the 775 million? Dude! Doesn’t the Governor remember the last session?
The response to any blathering nonsense about spending to repair “crumbling infrastructure” should be to point out that this is a core function of state and local government and it has failed miserably at it over the decades as money that should have spent to maintain and extend existing infrastructure as economically as possible were instead diverted by elected politicians and bureaucrats to their favored constituencies.
Minnesota state spending increased from 34 to 56 billion dollars 2000-2010.
There. Is. No. More. Money.
Sell the damn trolley line.
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