Do they get it?

Senators Charles Schumer, D-N.Y and Orrin Hatch, R-Utah, wrote an op-ed piece for the New York Times  January 25  in which they called for a Social Security tax break for employers in orders to boost job creation.

The Senators said that, under their plan, “any private-sector employer that hires a worker who had been unemployed for at least 60 days will not have to pay its 6.2% Social Security payroll tax on that employee for the duration of 2010.”

“The Social Security trust fund will then be made whole with spending cuts elsewhere in the budget between now and 2015.”

Creating jobs is a fleeting thing if there is no real work to be done. What happens at the end of 2010? Will spending cuts really replenish Social Security? Why would an employer hire and incur all related expenses to save the 6.2% that it would not pay if they don’t hire. Employer are not stupid, they understand the need to sustain a worker in a job when they are hired, that means they have something to do that adds value and revenue to an organization.  Workers were not laid off because of the Social Security tax they were laid off because demand was down and there was no work for them to do.

The key is demand for the goods and services newly hired workers provide, not gimmicks.

A better way to stimulate demand and help the unemployed at the same time; find a way to suspend sales taxes , perhaps by rolling it across America, by certain goods and services, whatever. That goes immediately to people but only if they spend which in turn creates demand across a wide spectrum (and gives politicians less money to throw away).

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