Magical Thinking Won’t Stop the Layoffs

Associated Press and reports:

Medical supply giant Stryker is the latest company to announce job cuts in anticipation of coming costs associated with Obamacare, even though the man who inherited a fortune from the company’s founder is a fan.

The company will cut 1,170 jobs, or five percent of its worldwide workforce, despite the fact that the founder’s grandson was one of the largest contributors to President Obama’s re-election campaign. Medical tech scion Jon Stryker, whose net worth is currently estimated at $1.2 billion, contributed $2 million to the Priorities USA Action super PAC and has given $66,000 in contributions to Obama and the Democratic Party. Stryker does not run the company.

And so it begins. The bigger the government tax and the more redistributive the scheme, the bigger the bite out of the private economy. Government devours the hand that feeds it.

Again and again, we’re told that socialist democratic policies are good for the middle class. Repeatedly, it’s claimed that what’s bad for the billionaires is good for everyone else.

And yet, every time government attempts to redistribute in favor of the “little guy,” the victims of the redistribution fight back. They have to. Why? Because that’s why private businesses exist: To make a profit, and survive.

Keep in mind that if Stryker didn’t respond to the new costs created by the Obamacare tax, everyone who benefits from the company would suffer. Yes, the stockholders and CEOs would suffer, but the employees — right down to the lowest paid janitor — would suffer even more. In short, the company would completely go out of business rather than still manage to survive with the additional costs imposed by Obama’s social welfare schemes and mandates.

The incredible thing is that the people responsible for passing these taxes and other impositions on private entities will never be held responsible. They are widely applauded for “caring” enough to pass these laws, to supposedly ensure that everyone is covered. Altogether ignored is the fact that somebody has to pay for them. Sure, big businesses must pay for them. But big businesses, for their very survival, will simply pass those costs along.

Every time government passes a tax or a regulation, this is what happens. It’s the nature of reality. Every action must lead to a reaction of some kind. The more costs government imposes on businesses, the more consequences there will be to those who depend on the business in some way. CEOs and stockholders get less income, but it’s more than that. Employees get less income, or lose their jobs. With fewer salaried people in the world, and more people living off the bare minimum dole of government unemployment or early Social Security, the fewer products and services are bought elsewhere in the economy. Economic growth, in turn, goes down and unemployment goes up.

Yet the more we see negative outcomes from government taxes and impositions, the more we blame not the ones doing the imposing — the government — but rather its primary victim: The private sector.

It’s a pretty nifty game these politicians have, in our socialist democracy. The more a problem exists (usually one created by government), the more they impose on the private sector. The more the private sector responds in self-protection, the more the private sector gets blamed for being “evil” and “selfish.” This sets the stage for still more government taxation and regulation — until eventually, at the end of the road, you’re like Communist Cuba, North Korea or Soviet Russia, and there’s nothing left to tax or regulate.

The “niftiness” of this game depends on the ignorance and evasiveness of the population in a socialist democracy (which the United States now is), and their corresponding willingness to put up with it. The verdict of the most recent election speaks for itself. The majority are still free, in two or four years, to replace this government with one who will massively reverse course — and end most of government spending and taxation as we now know it.

It’s not likely, of course, because human beings have a way of being lulled into a passive state of helplessness, the worse things get. And everywhere they turn — to religion, to government, to academia, to the media — this depraved and depressed way of looking at things is all they’ll get. American culture shows every indication, at present, of going the way of past great civilizations. Obama and his ilk are fully prepared to lead the “American sheeple” off the cliff.

It’s deeper than politics. It’s about mind, reality and ethics. Government does not have the power to make wishes come true. What government does have the power to do is to blame those who are successful, and who have money — and coerce them into making the wishes of magical thinking (free health care, free everything) come into existence. But magic always has its price. For details, witness the layoffs, the continuing stagnation and additional downturns coming as America completes its downward spiral into full socialist democracy.

  • Paul V Sutera

    Income redistribution? Where? The rich pay less in taxes than they did under Bill Clinton, when we created 22 million, mostly non-housing jobs. Germany and Japan have plenty of regulations and more equitable income distribution, and universal healthcare. And THESE 2 countries do NOT have employment crises. The problem with America is that gains in the stock market are taxed at rates much lower than real work. This creates a cycle of layoffs and greed, and ultimately, another more serious recession.

  • Paul V Sutera

    Free healthcare, free everything. No it’s not free but 50 countries have universal healthcare and most of them are doing fine and spend FAR less per-capita on healthcare than the USA. Most spend HALF what we spend, even before the ACA was rolled out. You think you aren’t paying now when someone walks into an emergency room? You are already paying. There are 400 people with more income than the bottom 40% of all adult Americans combined. We have income distribution on-par with most 3rd world countries. Somehow this author is living in a dream world where he sees all the giveaways…except the corporate welfare, he totally misses that.

  • Paul V Sutera

    I love it when they throw the word socialist around. We have income distribution like NO socialist country on earth. What about corporate socialism and corporate welfare? Why all the tax-breaks for corporations in this country that offshore jobs and money? No other country is run by corporations like ours is. Somehow this author lives in a fantasy world and has never met a real poor person in his life. He’s pining for a return of Gilded Age economics, well my grandparents lived in that time of 80 hour work weeks and no-heat tenements. No thanks.

  • Paul V Sutera

    Why not take on corporate welfare and corporate socialism? American companies park trillions in tax-havens. While WE pay our taxes. And the rich pay 13.7% while we pay 25-33%. That’s not socialism, that’s plutocracy! PLUTOCRAT !!

  • Paul V Sutera

    Plutocrat alert !!

  • writeby

    They still pay the lion’s share:

    “According to the CBO, the wealthiest 1 percent … paid 69 percent of the total last year (2010). The bottom bracket paid 0.4 percent.”

  • writeby

    Best way to eliminate corporate welfare, where it exists, is to eliminate the Welfare State.

    Incidentally, keeping what one has earned is not welfare, unless you view the nation as did Plato:

    “The best ordered state will be one in which the largest number of persons … most nearly resembles a single person. The first and highest form of the State … is a condition in which the private and the individual is altogether banished from life, and things which are by nature private, such as eyes and ears and hands, have become common, and in some way see and hear and act in common, and all men express praise and blame and feel joy and sorrow on the same occasion, and whatever laws there are unite the city to the utmost …” (Plato’s _Republic_ & _Laws_ c. 370 BCE)

    And his latter day disciple:

    “It is thus necessary that the individual should finally come to realize that his own ego is of no importance in comparison with the existence of his nation; that the position of the individual ego is conditioned solely by the interests of the nation as a whole … that above all the unity of a nation’s spirit and will are worth far more than the freedom of the spirit and will of an individual….”

    “This state of mind, which subordinates the interests of the ego to the conservation of the community, is really the first premise for every truly human culture…. The basic attitude from which such activity arises, we call-to distinguish it from egoism and selfishness-idealism. By this we understand only the individual’s capacity to make sacrifices for the community, for his fellow men” (Adolf Hitler, in a speech in Buckeburg, Germany, Oct. 7, 1933, explaining the moral philosophy of Nazism).

  • Paul V Sutera

    Yes sure, but they don’t pay what they paid in 1996. Either you believe in progressive taxes, or you don’t. I paid over 20%, mitt paid 13.7%, and the lower-middle-class guy? 28%. Hey I like it, what’s not to like? I got more money, I pay about the same as someone making 30K a year less. They shouldn’t feel bad about that. Right? ha!

  • Paul V Sutera

    I can see the individual being subsumed in the struggle of a nation… and Hitler liked that idea. The problem was his nation was not founded on principles of justice. If you read Plato’s republic, he was referring to a Republic. Hitler ran a dictatorship, not a Republic, except with its phony legislative branch. Let’s not get hung up on labels and symantics.

  • writeby

    Sounds as if you are.

    Rather, think in principles.

    Plato’s Ideal state–call it a republic if you like, ruled by a philosopher king, the methods and results are the same as Hitler’s, Pol Pot’s, Lenin’s, Stalin’s or Mao’s–is a blueprint for dictatorship. Human beings are not automatons; and to try to make them so requires sacrificing real life, flesh and blood individuals based on this sort of equivocation: “I can see the individual being subsumed in the struggle of a nation… and Hitler liked that idea. The problem was his nation was not founded on principles of justice.”

    I really liked, by the way, the euphemism, “the individual … subsumed by the state.” “To classify, include, or incorporate [human beings] in a more comprehensive category or under a general principle.”

    Yeah, that has about it the stench of “holding two contradictory beliefs in one’s mind simultaneously, and accepting both of them”–to wit, forcing individuals into a collective but at the same time applying justice, which can only be applied to individuals.

    Unless you think a lynch mob capable of applying justice or mass executions as applying justice or forcing actual, real live, human beings to be part of some sort of Ideal nation state as applying justice.

    Surely you must have majored in poli-sci in university.

    Finally, what we have developing in the U.S. is, as you point out, not socialism. It’s fascism. With either one, though, you eventually get some form of dictatorship, whether top-down or bottom-up. Doesn’t really matter if your neighbors, the majority or the proletariat do the despotism dance or if it’s some plutocracy or oligarchy or a Fuhrer. The results are the same: the destruction of individual freedom and the sacrificing of human life.

    But, hey, subsume on, dude; doing right’s got no end for the crusader.

  • writeby

    “Either you believe in progressive taxes, or you don’t.”

    I don’t. (Nor do I believe in taxation of income. But that’s another issue.) Nor does your follow-up correct your initial mistake: the rich pay more in taxes, far more, than the poor.

    Indeed, I’m one of those poor. I’m that “lower middle class guy” (middle lower class? whatever) who is always amazed by rich guys like you (& Buffet, etc.) wanting to increase taxes on “the rich” while using whatever deduction one can to pay less taxes. It’s been my experience that when taxes are raised on the rich, mine, too, are raised. To add to that–as history has proven time and again–economic development suffers. Or, from a personal view, I get downsized.

    And for what? To steal money from rich Peter to pay poor Paul via a massive bureaucracy? Yeah, that’s the ticket.

    Here’s what Jefferson had to say about that:

    “To take from one, because it is thought his own industry and that of his fathers has acquired too much, in order to spare to others, who, or whose fathers, have not exercised equal industry and skill, is to violate arbitrarily the first principle of association, the guarantee to everyone the free exercise of his industry and the fruits acquired by it.” —Thomas Jefferson

    But, hey, if it’ll relieve your “rich man” guilt, why not?

    In fact, why not set an example. If you view the rich paying their fair share (whatever the heck that means) as just, then begin with yourself.

    In short, first put your money where your mouth is; then your argument would have at least some credibility.

  • writeby

    Poor person here.

  • Paul V Sutera

    I majored in Computer Science with a dual major in Economics. My point is this: I should not pay 20% of my income in taxes if someone making 1/2 my pay pays 28%. The rich did fine in the 1950s-1960s paying much higher percentages of income taxes. The last time we had income inequality at the current level was in 1928. Keeping what one has earned. Interesting idea. At $125K a year, my high pay was predicated on others NOT being paid what they were worth. I don’t see us being more fascist than we were before Obama. We got dragged into Vietnam by corporate interests until they realized they could do business with these folks anyway. You can have all the individual freedom that you want but if 70% of a population lives on $2.00 a day, just so we can avoid the fascism of a safety-net, you won’t get far without that freedom. See how much peace, love and understanding you can stand on an empty stomach.

  • Paul V Sutera

    I think we also fail to realize that the rich are dependent on the middle-class and the poor having SOME money to spend. You must give to get. Your spending is MY income, my spending is your income. What pays for capitalism is wages, but if capitalism hoards all its wealth to boost profits and the stock market, capitalism commits cannibalism. We regulate and manage all sorts of things to good benefit – We tried the Gilded Age, or my great-grandparents in the 1880s tried the Gilded Age – it sucked.

  • Paul V Sutera

    Correction: You won’t get far WITH that freedom (if you earn $800 a year).

  • Paul V Sutera

    I think the entity known as a corporation barely existed in Jefferson’s time.
    He is speaking about taxing the blacksmith. Not Bank of America.
    I do not take any special tax-breaks, just the mortgage break, and the charitable contribution break, and the 401K break. I do not believe that CEOs earn their salaries in this country. Jefferson didn’t live in a time of paper money, stock market bubbles, phony derivatives etc. Anyway, Jefferson’s quotes are often taken out of context. Why should I pay any money for a military regime that goes off waging war? Why is your focus against the poor rather than the corporate welfare for the rich? Would not Lockheed-Martin be more resilient and self-reliant if we just pulled out support for the ridiculous TRILLION+ F-35 Fighter Jet? Years to produce a barely working prototype. Where is the conservative outrage on that? There is none.

  • writeby

    I’ll take the $800 yr. & freedom. I’ll at least have the opportunity to make more–and keep all of it.

    I’m not my brother’s keeper.

    Nor do I wish to be “kept” by my brothers.

  • writeby

    Jefferson spoke in principles, not concrete bound slogans or narrow timelines. He was speaking about individuals. Like blacksmiths–and stockholders; magnates & tycoons; business owners; flea market vendors; name it.

    As mentioned, if you want to stop corporate welfare, end the Welfare State.

    (Conservative? Hey, there’s no need to engage in ad hominems.)

  • writeby

    ROTFL. Okay, you majored in (postmodern) new Keynesian economics. Same-same.

    First lesson in reality economics: wealth is for which money is a standard, not the reverse.

    A healthy economy is all about the creation of wealth, without which the middle & lower classes would have no money to earn or to spend.

    And I’ll take that Gilded Age–an ad hominem leveled by an envious (& power lusting) pol–which saw an emerging middle class, boundless increases in wealth and freedom. At least for a while. That is the closest any nation has come to capitalism. Today, there isn’t a single nation that isn’t ruled by some sort of command economy. And look at the results.

    But anyone who thinks demand drives supply wouldn’t understand nor would they be capable of discerning the diff between the looting rich and the productive rich; between taxes and profits; between coercion and choice.

    Or the link between increased wealth & productivity and increased wages.

    Nor would they grasp that
    government spending (of paper it prints) produces nothing (WWII notwithstanding–note postwar inflation); that lassez faire–in which property rights, including individual rights are protected & defended by the government–is not jungle law; that collectivism rests on the tenet “we are all interconnected” & that Plato’s Ideal state must result in tyranny.

    Finally–and I wonder at my ability to put together a cohesive rebut to your disconnected ramblings–do this thought experiment:

    You’re in a parking garage, back against the wall, surrounded by a gang covering you with PP2000s on full auto. You have a choice, they tell you: die or obey them, along with all their other hostages. Over time, you discern that some are open to bribery & will lighten up on you if you pay them. Others offer to let you join them if you rat out your fellow hostages.

    Real world examples? Okay…


    “All of the banks have received federal bailout cash — in some cases after being told they must … ”


    “Documents Reveal How Paulson Forced Banks To Take TARP Cash”


    “Bankers: Take your TARP money back”


    “NEW YORK – The chief executives of the country’s nine largest banks had no choice but to accept capital infusions from the Treasury Department in October, government documents released Wednesday have confirmed.”

    This is the “choice” facing businessmen under a government that uses its coercive power to “redistribute” income and “regulate” an economy, rather than simply protect & defend individual rights: obey or be discredited and/or imprisoned.

    Whose interests do you suppose one is serving who asks for more regulation of the economy; wails about rich capitalist pigs; demands higher taxes on the rich; talks of wage “slaves”; spouts New Keynesian dogma; and chants like a monkey slogans about “taking over Wall Street”?

    Three guesses and the first two don’t count.

    So–and this is my last attempt to get you to put down your college taught dogma & be objective–if you want to get business out of government, get the government out of the economy–a separation of state & money, as there is with religion and for the same reasons.

    Until then, the nation will continue to head toward fascism (which, if it makes you feel better, some call, “corporatism” while ignoring who holds the whip). Fascism is that form of government in which business has all the responsibilities of production whilst government has all the control. And if you examine Mussolini’s fascist government (1922-1944)–or even Hitler’s–you will find corrupt businessmen working hand-in-hand with their masters–or in the case of honest ones, being coerced to do so.

    In fascist Italy:
    Chamber of Fasci and Corporations
    Assicurazioni Generali
    Società Finanziaria Telefonica (STET)

    In Nazi Germany:
    I.A. Topf and Sons
    C.H. Kori GmbH
    I.G. Farben
    Bavarian Motor Works

    Recommended reading:

  • writeby

    You just keep repeating the same bromides and myths you were taught.

    How convenient for the current ruling class.

  • Paul V Sutera

    No-one becomes rich by selling to wage-slaves making 25 cents an hour. We are all connected. We are ALL our brother’s keepers. Mr Job-creator, who can buy your iPad except in a country where wages are high enough. What you describe sounds like anarchy, not libertarian thought. It is *your* ideology that is so coveted by the ruling class. Under your ideology, we’ve had record job loss and record (unsustainable) profits. WWII is a prime-example of government spending ending a recession. Please find me one working example of a country that follows your theories and principles and puts them into practice. The closest you will come is the Gilded Age United States government. Who advocates “management” for firms yet believes countries can run on pure laissez-faire capitalism with no regulation, no “management”? Any examples of a modern-day country with your ideal government that is larger than a city-state? We had 50 years of prosperity in this country. Letting the business interests take over the government was the beginning of the end of that prosperity. That’s not a bromide, that’s reality. Please find for me one working example of the kind of government or non-government that you think is the shining example of where we need to go.

  • Paul V Sutera

    Sounds like the jungle of Papua New Guinea or places in the Amazon would afford you your ideal life living according to your principles, which I contend are non-principles. And when I was a young man, believe me I had powers beyond comprehension to want to reject any help from any entity. I could throw hay and shovel manure all day and go for a 6 mile run after work in 80 degrees. We are connected, all our fates and fortunes are intertwined. The headless horseman isn’t your killer, he’s your guru. We are the universe, we contain everything, including the souls of our brethren.

  • Paul V Sutera

    Seeing a safety net as the pablum of the ruling class, a mere bromide. If you are far enough removed from the souls of your brethren, let me guess that you live a lonely life. I am the beneficiary of the safety net. So is Walmart. They vote through their PACs for a reduction in government benefits…then they are surprised that THEIR OWN fortunes drop when their customers lose their Food stamp money. The same applies to you, you benefit from others being helped, but you don’t realize it because of a personal mythology of separate souls, separate lives.

  • writeby

    I’m 62, son.

  • writeby

    Obama’s in the house.

  • Paul V Sutera

    Take your TARP money back…. sure after they foreclosed on a number of homes, they didn’t need the money. After the economy didn’t crash as badly as predicted, they had money to burn. Wealth-creation today versus 1880 – one cannot really compare the two. The middle-class arose during the Gilded Age? I think not. A mostly empty world of fewer than 1 billion people – of course things were growing quickly. Wealth creation – in a world of investors who sell something to someone – who HAS money to buy it. Capital is stagnating today, the investment model is to grow the hoard, not to grow business, but to grow the stock market to enrich a few people who are not the Bill Gates and Steve Jobs of the world. We’ve lived well with income redistribution for decades. Surveys of Northern European countries that have good balance sheets show personal satisfaction and happiness are high there, despite gloomy weather. These are high-tax countries with lots of income redistribution. Plato’s Republic? First of all a philosopher king answers to the people, not the corporation. Marcus Aurelius was such an emperor. Anyway, it sure took them a long time to repay the TARP money – which undercuts the phony press given to “I don’t need your handout”.

  • Paul V Sutera

    Well we certainly had a hands-off approach after the crash of 1929. I do not believe for a minute that these banks didn’t want the bailouts. That was predigested-pablum for the investor community. You are looking behind trees to see a government hell-bent on controlling the country and the people. But I see the main beneficiaries are the ones setting the policies: Corporations are not being bribed to go along. Congresspersons are being bribed to go along with corporations! Taxes have not been lower on the middle-class in decades. They were higher during the Clinton years. So where you get all this income redistribution blather is beyond me. We lost 58,000 factories during the 10 years after 2001. So that did put more people on the dole. The government in this country (compared to Japan or Germany) DID act at the behest of corporations to reduce taxes and create trade deals that offshored jobs. Euro governments fight hard to keep jobs in country and disincentives for offshoring are in place.

  • Paul V Sutera

    Tell me what you did for a living when you worked? And why are you poor now? I see most of your causalities as reversed from reality. My fate, my wealth, my fortune, does not lie in a vacuum divorced from the fate of others. Money spent on the safety net is well-spent. Even if I’m not in the net at the moment. Wealth is nothing more than the velocity of money, and investments trapped in the stock market/buyback cycle represents the stagnation of money. These economic principles are 19th Century Classical economics principles. Money that is being taken from me in the form of taxes for the safety net – keeps me afloat because the money is rapidly spent. 19th Century economics didn’t come to that conclusion but it leads there. The rich are hardly hurting, they’re richer than ever now. So this should have led to prosperity by your reckoning. The US middle-class was the source of most entrepreneurs and “job-creators”. They are paying the taxes for the whole country.

  • writeby

    You’ve well learned your catechism, though you need to organize it better in your writing.

    Reminds me of something Kipling wrote:

    In the Carboniferous Epoch we were promised abundance for all,
    By robbing selected Peter to pay for collective Paul;
    But, though we had plenty of money, there was nothing our money could buy,
    And the Gods of the Copybook Headings said: “If you don’t work you die.”

    As it will be in the future, it was at the birth of Man —
    There are only four things certain since Social Progress began: —
    That the Dog returns to his Vomit and the Sow returns to her Mire,
    And the burnt Fool’s bandaged finger goes wabbling back to the Fire;

    And that after this is accomplished, and the brave new world begins
    When all men are paid for existing and no man must pay for his sins,
    As surely as Water will wet us, as surely as Fire will burn,
    The Gods of the Copybook Headings with terror and slaughter return!

    Dogma on, dude.

  • Paul V Sutera

    Aha! well 2 can play at the game of cherry-picking quotes. Rich man’s guilt? You mean Concern for the poor is really coming from fear and evil (guilt)? Altruism is real my friend.

    “In a letter to James Madison in 1785, for instance, Thomas Jefferson suggested that taxes could be used to reduce “the enormous inequality” between rich and poor. He wrote that one way of “silently lessening the inequality of property is to exempt all from taxation below a certain point, and to tax the higher portions of property in geometrical progression as they rise.”

    Madison later spoke in favor of using laws to “reduce extreme wealth towards a state of mediocrity (meaning the middle) and raise extreme indigence towards a state of comfort.”

    There you have it.
    Anyway as a token of goodwill, I’m being careful to not make any ad-hominems here. But what do you call yourself, Libertarian? (apparently you didn’t like conservative). WHO do you vote for if and when you vote?

  • Paul V Sutera

    As I mentioned, Jefferson and Madison discussed income redistribution and agreed it was a good idea. They were objecting to the idle – rich and poor. They probably weren’t thinking about people who worked for 35 years and collected a pension – as being idle. Nor people who were downsized after 30 years and couldn’t find a job. Some people are really really deficient in their executive thinking. They would starve without help. But I like having them alive. They make fine art, great music, they share great love. They can’t fix the toilet or light a fire in my woodstove –

  • writeby

    “Jefferson and Madison discussed income redistribution and agreed it was a good idea.”

    Cites please.

    As for the rest, in a capitalist society, if you wish to support suck folks, no one will stop you.

    I swear, it’s as if you’re reciting disjointed passages from some sort of catechism, careful to avoid addressing any of the points and evidence I list, relying instead, in response, on unsubstantiated assertions, emotionalist rhetoric or repetition.

    Tell ya what, just assume to yourself you’re right. That way you can move on.

    As for me, one can’t profitably debate an emotionalist or a sloganeer. So I am moving on. Now write another long diatribe of compositional noise, and we’ll be done here.

  • writeby

    “But what do you call yourself, Libertarian?”

    Anarchy is not a political principle. It’s an epitaph.

    I’m a radical for capitalism.

    I’ll deign to vote when I actually have a choice. The current options between a “moderate” amount of fascism or a great deal of it is no choice at all. Nor is the alternative of a theocracy (which would be even worse) or of genuine socialism or outright communism any different, either.

    The results, ultimately, are the same: totalitarianism. Or, in the case of a theocracy, a new dark age–the worst of both worlds: despotism and primitivism.

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