Explain the Higher Tax = Layoffs Argument to Me

[JS80]

LOL no he doesn't, some of that money comes back to the company. Just because the government taxes the money doesn't mean the money goes out of circulation out of the economy (in fact, the direct opposite happens, see GDP multiplier). Add to the fact that most companies hire based on DEMAND. If someone wants your product and you don't have enough workers to meet that demand, you hire more people.

You idiots need to learn econ and stop with this armchair quarterbacking.

lol armchair quarterbacking? I work in real life as an offensive coordinator. I told the QB to cut 20 heads because we need more cash flow to invest in the business. We would have to cut more if tax rates went up.

What do you do for a living?

 

[randomrogue]

LOL no he doesn't, some of that money comes back to the company. Just because the government taxes the money doesn't mean the money goes out of circulation out of the economy (in fact, the direct opposite happens, see GDP multiplier). Add to the fact that most companies hire based on DEMAND. If someone wants your product and you don't have enough workers to meet that demand, you hire more people.

You idiots need to learn econ and stop with this armchair quarterbacking.

You have clearly never run a business.

 

[Paul98]

Again, you wouldn't want to do either but companies are forced with a choice. If they can lower production by still keeping their profit margin they will. Labor is the higher cost to companies/employers. So if they can figure out how to do it with less labor they will, even if it means producing a little less. It not a 1/1 ratio. Believe me, companies figure out a way to get blood out of a turnip, or at least they try to.

But why lower production and total profit to "keep" profit margins? If profit margins are that important, why not make the changes in the first place? If they are already trying to get the most out of the least they can why would raising taxes change what they are doing now?

 

[Phokus]

lol armchair quarterbacking? I work in real life as an offensive coordinator. I told the QB to cut 20 heads because we need more cash flow to invest in the business. We would have to cut more if tax rates went up.

What do you do for a living?

LAUGH, what a fucking liar, most businesses make their decisions based on demand for their product. I do the forecasting and budgeting for my business unit. We cut heads because of DEMAND. We literally do not give a flying fuck about taxes and our performance is measured in EBIT.

 

[Macamus Prime]

Yep, you're right. The middle class, everyone of them, has been unemployed for the last 40 years. They haven't been able to purchase a damn thing because they don't get an income. IDIOT!

http://news.yahoo.com/blogs/lookout...rowing-rich-poor-gap-20110223-141311-132.html

 

[JS80]

LAUGH, what a fucking liar, most businesses make their decisions based on demand for their product. I do the forecasting and budgeting for my business unit. We cut heads because of DEMAND. We literally do not give a flying fuck about taxes and our performance is measured in EBIT.

Shens. Working for your uncle's restaurant doesn't count.

 

[Phokus]

Shens. Working for your uncle's restaurant doesn't count.

Well the last restaurant i worked for was called "IBM" and the one i currently work for is almost as big. You're dumb and i'm surprised you think you can write out that tripe without being called on it.

 

[randomrogue]

If the money is invested in the business, how is it profit?

This is slightly beyond the scope of this discussion but here it is in a nutshell.

Even a small business will generally have some form of stock shares that will be divided among a couple "owners". It might be a 80%, 10%, 10% split. A good salesperson will be rewarded with a few percent maybe so that he works harder and stays with the company.

What this allows the company to do is award dividends. You can award bonuses (you pay the taxes) or dividends (the company pays the taxes) and it's always better to get a dividend.

So you own a share of a company. Each year you invest in it to help it grow. This in turn makes the company make more money and it increases the value of the company and your share of the company. Year 1 you have $300,000 in inventory that you're turning it over a few times a month at a 10% rate of return. Year 10 you have a $3,500,000 inventory that you're turning over at a 20% rate of return. A certain percentage of that is yours. Your dividends get bigger. If you sell the company you get a lot more money.

 

[xBiffx]

But why lower production and total profit to "keep" profit margins? If profit margins are that important, why not make the changes in the first place? If they are already trying to get the most out of the least they can why would raising taxes change what they are doing now?

Companies are limited to the costs they can control. Labor is one. They can't change too much how much they pay for the goods they need to produce their products. They can change how much their labor costs. When you increase taxes, thereby affecting their profits, they will react with what they can change. Companies try and squeeze out all they can, regardless of if taxes are low or high, but when you increase taxes, then the microscopes come out and cost cutting measures start moving to the front burner.

 

[JS80]

Well the last restaurant i worked for was called "IBM" and the one i currently work for is almost as big. You're dumb and i'm surprised you think you can write out that tripe without being called on it.

That's even worse. You do analyst monkey work for a business unit of a global mega corporation. No wonder you have such a myopic view.

Have fun querying oracle db all day.

 

[randomrogue]

Well the last restaurant i worked for was called "IBM" and the one i currently work for is almost as big. You're dumb and i'm surprised you think you can write out that tripe without being called on it.

You clearly don't know what you're talking about so just stop it.

Supply and Demand are not the sole movers of the market. You can clearly see this by simply looking at different commodities and seeing that there are speculators in there. I wish it was just supply and demand since it would make my life a lot easier. I hate waking up in the morning and seeing the market (the one I work with) moving irrationally because a hedge fund decided it was going to manipulate the market.

 

[Deudalus]

As someone who does financial forecasting and budgets, this statement is dumb. Anyone who does forecasts, whether it's for a company or for the government, will tell you that forecasts are very rarely accurate and if it is, it's entirely by accident.

As someone who is an independent contractor, I have to disagree. But to each his own I suppose.

 

[xBiffx]

http://news.yahoo.com/blogs/lookout...rowing-rich-poor-gap-20110223-141311-132.html

Your point? Oh right, you haz none. Your earlier rant was just that, a rant. Sure the rich are getting richer and the poor are getting poorer. So why don't you do something about it, get an education/learn a skill and get a piece of that pie instead of bitching about it and expecting someone else to fix it for you.

 

[Phokus]

That's even worse. You do analyst monkey work for a business unit of a global mega corporation. No wonder you have such a myopic view.

Have fun querying oracle db all day.

Funny how you can jump from thinking i work for a very small business to working for a global giant and having a negative view of both. You're all over the place. BTW, working for a small business unit of a big company gives me the perfect view of the incentives on hiring/firing people. Fewer customers calling in for support help? Lay off call center people. Fewer deliveries being made? Lay off warehousing people. Need to install websphere? Hire a couple IT guys. Not once did TAXES come up in our conversations. It was all about how much you can get away with before you start to lose more customers due to poor customer service.

 

[Macamus Prime]

You don't get it. So how about you look at the UBS job losses from another point of view. What if UBS made more money before but was now making less due to the Eurozone and other global economic problems? Would it not be appropriate for them to cut costs to get their profits back to where they were before? Businesses are run to make money. In turn people get jobs. First comes profits. Then come jobs. The middle class is getting jobs. If you raise taxes though then that business that has 12 employees but is down to bare bone expenses will simply close it's doors and now you have 12 UN-employed people.

Yes - businesses do exist to make money. But, there is no way in hell they operate with the intentions of employing the American people. They just want to churn profits; reduce headcount and outsource jobs.

If and when things DO get better, and the company is back to making the money it used to make before the 2008 collapse, does that mean UBS will internally regrow the outsourced jobs?

No.

The term "job creator" does not exist in the US. Business owners have no incentive, nor desire to keep American workers. They search for ways to cut corners and save money on operating expenses, constantly.

And, here is the kicker; these very same businesses LOSE money from prospective investors, because they can not show or prove they have a track record of working with minority business owners.

They have, or are, painting themselves in a corner. They slash jobs held by Americans. They outsource whatever isn't nailed to the ground. So, there isn't anyone American, nor local minority business owned working for these companies.

Plus, they give their operational needs to countries which have lax environmental laws and regulation.

I have no idea how much longer they think this approach will be sustainable to the growth they have captured over shrinking and outsourcing work, to gain more profits.

 

[Macamus Prime]

Your point? Oh right, you haz none. Your earlier rant was just that, a rant. Sure the rich are getting richer and the poor are getting poorer. So why don't you do something about it, get an education/learn a skill and get a piece of that pie instead of bitching about it and expecting someone else to fix it for you.

You just said the BOLD is not the case in your earlier post.

Thanks for making it even more clear, that you are nothing more than slime that leaked out a dead donkey's anus.

 

[IBMer]

If I have to pay higher taxes I will just hire more people in India to mitigate the tax increase. It has nothing to do with firing an employee and not replacing that employee. That employee is replaced with Indian labor.

This is where the fallacy starts. If they can get away with moving those jobs to India and save money, they will do that regardless of a tax increase. They are doing that now and taxes have been lowered. Right now two major things have effected job creation. Demand for the service/product of the company and the Labor Surplus.

 

[randomrogue]

Not every company outsources. I don't. It's up to each and every one of us to not purchase from companies that do if it bothers you. It is not relevant to many if not most businesses though. When you go to the local car mechanic he is not outsourcing his work to Pakistan. Neither is your local sandwich shop, gym, or super market.

 

[xBiffx]

You just said the BOLD is not the case in your earlier post.

Thanks for making it even more clear, that you are nothing more than slime that leaked out a dead donkey's anus.

I did? Hmm, again reading not required for liberal idiots on these premises. Your meds, they is calling.

Yep, you're right. The middle class, everyone of them, has been unemployed for the last 40 years. They haven't been able to purchase a damn thing because they don't get an income. IDIOT!

 

[Ns1]

when taxes get too high companies move.

 

[Phokus]

Not every company outsources. I don't. It's up to each and every one of us to not purchase from companies that do if it bothers you. It is not relevant to many if not most businesses though. When you go to the local car mechanic he is not outsourcing his work to Pakistan. Neither is your local sandwich shop, gym, or super market.

It's not really a choice, in the long run. Sometimes outsourcing doesn't work and your customers get pissed off about it, but if it does work, and your competitors are successful at it, your company won't be able to compete, eventually (unless they also engage in outsourcing).

Edit: Of course it is impossible to outsource some work, i mean obviously your car mechanic is going to be local, that's a silly thing to point out.

 

[Macamus Prime]

I did? Hmm, again reading not required for liberal idiots on these premises. Your meds, they is calling.

Yes, you did. You made it pretty clear that the middle class HAS been growing. The reality is that is has not.

Listen, I know you want to be cool like the rest of the racist conservative shit suckers on these boards who love to spit on and downplay the existence of the poor and middle class in the world - but, you have to realize something every simple; the rich men who poop in your mouth and expect you lick them clean are NOT reading these forums and following the good fight you are putting up for them on their behalf.

You will not be rewarded.

You will not even be thanked.

You are nothing more than a self appointed fingerman swine shithead that is using his loathing and anger for those "lesser" than yourself and masking it as "good old American hard work".

You are:
1) too stupid to fool or rip off anyone, like the rich have
2) too retarded to realize you are "fighting" for someone who doesn't even know you exist
3) too angry to lift your hate of the poor and fellow man to realize this path you chose to harm them will even lead you anywhere

 

[randomrogue]

WTF is your major malfunction? You get fired and shit on?

 

[SilentRunning]

My uncle runs a restaurant. Here's how he explains it. Taxes determine whether or not he takes an extra vacation to the bahamas, it doesn't determine whether he hires an employee or lays one off. The ONLY metric he uses to determine hiring/firing is if there is increased/decreased demand for his product. The government could cut his taxes to 0% and he wouldn't hire a single new employee unless business picks up. Even if his taxes were 60%, it would be stupid of him not to hire more waiters if his customer size doubles.

Anyone who still believes in supply side economics: You're horribly retarded.

Your uncle doesn't take that vacation to the Bahamas. That means the travel agent has fewer customers, the airport parking gets less revenue, and the airline has fewer customers. So travel agencies reduce their employees, airports reduce their employees, and airlines reduce their employees. Yep it makes no impact on hiring.

Now those employees that are fired won't be eating out anymore at your uncles restaurant so his customer base is reduced.

 

[Phokus]

Your uncle doesn't take that vacation to the Bahamas. That means the travel agent has fewer customers, the airport parking gets less revenue, and the airline has fewer customers. So travel agencies reduce their employees, airports reduce their employees, and airlines reduce their employees. Yep it makes no impact on hiring.

Now those employees that are fired won't be eating out anymore at your uncles restaurant so his customer base is reduced.

Again, the money that is taxed doesn't suddenly disappear out of the economy, it is recirculated back into the economy. The posts from some of you people are becoming more and more bizarre.