‘Jobs’ bill is mostly for show

The $17.6 billion so-called "jobs" bill signed by President Barack Obama in a Rose Garden ceremony Thursday will have only a tiny impact on America's 9.7 percent unemployment rate, economists admit.

And that's assuming it's not taken advantage of by those with a talent for "gaming the system."

The measure exempts businesses from paying the 6.2 percent payroll tax on new employees who have been out of work for at least 60 days. Firms will get an additional $1,000 credit if new hires stay on their payroll a full year.

"200,000 is my maximum estimate" for the number of jobs the legislation will create, says Timothy Bartik, senior economist at the nonpartisan W.E. Upjohn Institute for Employment Research in Kalamazoo, Mich. And the number will "probably (be) less than that."

Mr. Bartik gave the Christian Science Monitor two reasons for that: "One, it is small. And two, it requires employers to jump through hoops, and complexity requirements will make it less attractive."

Especially if there are penalties for paperwork mistakes and misinterpreting the law -- which there will be.

But talk of "creating jobs" invokes Frederick Bastiat's famous essay "What Is Seen and What Is Not Seen," anyway.

Government can only subsidize one thing by moving money that might have been used to create a different job somewhere else. For instance, long before the Obama administration started touting plans to "create jobs" with tax subsidies for wind power and other "green energy" boondoggles, the government of Spain, which has been pushing wind power for years, surveyed their results and regretfully concluded that every job "created" by wind subsidies actually cost the Spanish economy 3.2 jobs somewhere else.

Here in America, an estimated 8.4 million jobs have been lost in the past two years. The way to restore those jobs is to encourage private industry to grow. But it's hard for private firms to borrow when government is already devouring most of the available capital. Meantime, employers are scared to death by current uncertainty over future taxes and regulations.

Yes, tax policy can help. By simplifying or cutting taxes permanently. Who decided employers could be turned into unpaid tax collectors, in the first place?