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Kimberly-Clark Corporation Message Board

  • dwb360 dwb360 Aug 30, 2012 1:01 PM Flag

    Demand Creates Jobs

    In watching the Republican Convention, it appears that all of our country’s problems can be solved by cutting taxes and reducing regulations on small businesses.

    It’s time for a realty check. During the Bush administration both taxes and regulations were cut and look what happened; our country experienced slow growth, falling real wages, slow employment growth, a very substantial increase in our national debt, and the “Greatest Recession” in many of our lifetime. These facts can not be disputed.

    While I believe that the tax code should be completely revised and that some regulations need to be reviewed and perhaps eliminated, the Republican Party apparently does not understand that it is demand that creates growth, and consequently jobs; not lower taxes.

    If products are in demand and individuals have the funds available they will purchase them. Unfortunately over the past decade real wages have gone down as our country has transitioned from an industrial economy to a service economy. Adding to the problem has been the outsourcing of jobs overseas and the housing crash all of which have resulted in less cash in the pocketbook of the consumer. As a result, overall demand is down and consequently employment.

    What our country has to do is to get more money into the hands of the consumer. This can be done either through tax policy, public work projects, or an increase in the minimum wage. Reducing uncertainty and developing long-term solutions to the problems facing our country would also give our economy a psychological boost.

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    • Wow excellent thoughts! Many of your points hit the nail on the head, particularly the loss of consumer strength due to shrinking wages and employment because we are losing the industrial sector. That is the source of this sustained weakening of the US economy.

      But what republicans and democrats don't understand is that large manufacturing corporations have been lobbying for and getting the authority to manufacture in other countries to avoid higher wages and regulations so they can revert back to less automated processes that require educated laborers to run the machines. The free trade agreements (which are really special interest trade agreements, free trade is inconsistent with the appendixes included in those agreements) are a primary component of this manufacturing move outside this country. This increases their profitably at the expense of jobs in the US.

      There are simple ways to correct this problem, but large manufacturing companies will lobby against them misleading politicians to think that their motivation is patriotic when in reality it is personal wealth. Personal wealth earned by everyone, not given away by the government, requires the greed of corporate leaders to be redirected to growing their company inside the country consuming their products by producing those products inside that country. Of course that means modifying free trade agreements to promote internal manufacturing.

      With the technology available today automated manufacturing can produce the same products in the US at equal to or less cost than manufacturing in a foreign low paying, low regulated country. If our greedy corporate leaders would learn this lesson, their wealth would increase, the wealth of Americans would increase, poverty in the US would decrease and welfare needs in the US would decrease.

      Of course that will never happen again, because the greed of democrats and republicans will allow them to sell their power to the highest bidder, rather than intelligent reasoning that does not pay them anything.

      • 1 Reply to corebusiness
      • Your reasoning is sound. Henry Ford knew that if you paid your employees good wages they could afford to buy his company's cars and they did. The salaries that corporations pay their top executives today is way out of line when compared to the average production worker. It's called Greed! Look at the vast sums of cash on the books of many of the largest corporations. It is not being reinvested in the business because the demand is not there.

 
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