Missouri businesses are misallocating ‘political capital’

Nearly every politician these days is touting how he will “create jobs” with his wonderful programs and leadership. Often, opposing candidates in a race will each have their own “job creation” ideas; advertising those, while bad-mouthing their opponent’s ideas on the subject – even if their ideas are pretty similar in the first place.


As I see it, there are three ways government can facilitative job creation:

·   Direct cash subsidies – write a check directly to a certain business or businesses in a certain industry, or those involved in activities that meet certain criteria. Our friends on the left tend to describe this as “corporate welfare,” except when it’s their cronies getting the cash: Green Jobs, etc. 

·   Business tax credits – these are effectively back-door subsidies, whereby instead of cutting a check, the treasury will get less tax payments from businesses that meet the tax credit criteria. There have been popular tax credits for: historic preservation, low-income housing developments, government-backed bond issuance, and the like. More modern versions include various programs to discount the property or other local/state taxes for the increased value due to the expansion of certain businesses; or “jobs created” during certain periods.

·   Low Taxes and Regulations for everyone – Have a tax code that is as even across all board as possible, with few if any carve-outs for certain businesses or economic activities. Coupled with relatively low (or at least stable, and known) business regulations this makes sense to the average person.  Continue reading