The US Internal Revenue Code has long subsidized business investment through accelerated depreciation allowances and direct investment tax credits. This is in fact a business subsidy that has only been made palatable when accompanied by the myth that business investment inevitably yields increases in employment. This is simply untrue.
A look at the shape of the economic recovery of the past few years helps dispel the myth. All of the economic policies, taken together, have yielded tremendous increases in corporate profits among domestic corporations. Before the recession, for the four quarters ended
So let's cut through the guano and recognize that corporate subsidies generate profits, not jobs! Let's get rid of corporate subsidies entirely. Let's get rid of all the subsidies that are embedded in the system of taxation we have created. The Republican platform explicitly accuses Democrats of using the tax code for "social engineering." In truth, both parties have used the tax code for their own purposes -- this explains its complexity and its ineffectiveness. The whole code needs to be thrown out entirely and replaced with a simple tax system.
Free markets create jobs -- both the supply side and the demand side are required. By eliminating all the incentives and subsidies in the tax code, buying and selling decisions can be returned to the marketplace. Don't think for a minute that investment subsidies -- or any others -- actually create jobs. Increased demand creates jobs.
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