Job Creators

Which group creates the most jobs in an economy?

Group 1: 200 million households with an average of $50,000 each?

Group 2: 2 million households with an average of $5,000,000 each?

House Speaker John Boehner calls Group 2 members "job creators".

What is Group 1?

Both groups have the same amount of money (about $10 trillion in this hypothetical example). Group 1 members are buying food and clothing, washing machines, cars, computers, hairdriers, and microwave ovens. They go to movies, eat at restaurants, take vacations, use cell phones, get their hair cut. They seek doctors and plumbers and teachers for their children.

However, according to Boehner, they are not "job creators". Only people in Group 2 are actually "create jobs".

Well, maybe only those people in Group 2 get to be called "job creators" because they actually hire people. They are the employers. We are the employees.

But . . . what are they hiring people to do?

It would seem to me that they are hiring people to harvest and ship food, sell clothes, repair washing machines, build power stations, write computer software, build web pages, service bank accounts, wait tables, teach, provide medical care, build movie sets, provide cell phone services, cut hair, and the like.

But they wouldn’t be doing any of these things without people in Group 1 buying the things that these employees are working to provide.

When people are not buying these things, Boehner's so-called "job creators" become "job destroyers" as they lay off people and close businesses. That is if we adopt the "employer" definition of "job creators" as opposed to the "consumer" definition.

Now, it must be admitted that these 2 million people with an average of $5,000,000 are also job creators - along with the 200 million with $50,000 each. They hire people to design, build, and decorate large and expensive houses, buy expensive jewelry, collect expensive cars, buy personal jets, eat in the finest restaurants, buy tailor-made clothes, travel around the world, take cruises, build home-theater networks, and hire gardeners, maids, and chauffeurs, and secretaries to do their errands for them. Like Group 1, they create jobs. They just create different jobs.

While Group 1 makes up 1 percent of the population in this hypothetical community, they have half the wealth and, thus, create half the jobs. In other words, half of the productive power of this society caters to the interests of 1% of the population of this hypothetical community, and the other half caters to the other 99%.

Representative Boehner is giving us meaningless political rhetoric rather than meaningful political solutions. He is falsely asserting that Group 2 members are special, magical people who have supernatural qualities with the power to “create jobs” that the rest of us lack. This, he says, is why Group 2 deserves special protections - why we mere mortals must shoulder 100% of the burden of fiscal discipline and the special 1% must be spared even the slightest burden. If Boehner's gods are happy, then and only then will they bestow upon us their divine gift of employment.

This part of Boehner's political rhetoric is simply false. It plays well to the worshippers of the Ayn Rand "Objectivists" religion, but it is as much myth and superstition as another religion.

It is true that the average Group 1 person cannot, by herself, create as many jobs as the average Group 2 person by himself. However, Group 1 people are out there creating jobs. Putting the whole of the burden of balancing the budget on Group 1 because Group 2 are "the job creators" is simply a myth that aims - well, it aims to try to convince Group 1 to take on the whole burden while Group 2 takes on none.