Cooking the books; Do tax cuts create jobs?


By MARTY O’CONNOR We’ve heard a lot of talk lately about tax cuts and jobs. The assumption by those who want lower taxes is that higher taxes mean fewer jobs. Is there


any truth to that? The Fiscal Policy Institute


(FPI) has found the spending side of the equation is really more important to employment than is the tax side. Other reports have found no visible correlation between tax policy and job creation. You must weigh far too many variables


to be able to legitimately tie taxes to employment or job creation. So, how are these claims backed up? You might be surprised to learn sometimes research groups that conclude higher taxes kill jobs cook the books. FPI tried to analyze the report the


Manhattan Institute used to back up its claims that higher taxes mean fewer jobs. The problem is the Beacon Institute, that produced the report for the Manhattan Institute, refused to provide the data it used to reach its conclusions. Such a refusal is highly unusual for legitimate empirical studies.


Then again, perhaps this was not a


legitimate empirical study. Like everything the Manhattan Institute does, the goal was to support its ideology. The sordid truth about all of these


analytical models is they are based on assumptions. Since you control the outcome by your choice of assumptions, you can make a model say anything you want. If you subject it to peer review, your


assumptions will be exposed if they are faulty or one-sided. If you hide them, it’s for a reason. The truth about tax cuts and jobs is


the link is tenuous at best. Employment and job creation depend on so many variables that any single variable is meaningless by itself. When President George W. Bush


proposed his sweeping tax cuts he got the Heritage Foundation to produce a report showing the cuts would produce millions of new jobs. They didn’t. In response to this blatant error, the


Heritage Foundation said it couldn’t have foreseen the 2001 recession. The tax cuts didn’t matter in the face of all of the other economic forces at play. So, here we are in 2011 and the scam


is in play again. The Republicans in the House of Representatives claim their budget bill would cut trillions of dollars from social programs. It also would boost tax cuts for the wealthy and big


corporations. Once again, they use the Heritage


Foundation to produce the numbers to back up their plan. The foundation’s report claims the cuts will reduce unemployment to 2.8 percent. First, you need to understand the


unemployment level when there is “full employment” is around 5 percent. Second, an economist at the company


that created the model the Heritage Foundation used to get that result, responded to the 2.8 percent unemployment rate claim by saying, “I’m not sure what assumption would deliver 2.8 percent unemployment. We might assume different parameters.” One of the assumptions was the


housing market takes off. However, with the backlog of foreclosures, glut of houses on the market and falling prices many question if the housing market can recover, let alone take off. One member of the Heritage


Foundation modeling team was “surprised” by the optimistic finding and thought it could be caused by “an artifact of historical data.” In other words, the predicted job


growth is not reflective of real world conditions and is, therefore, wrong. That didn’t change the report or the


claims. So, here we go again. Another lie about tax cuts creating jobs.


Survey results may improve mental health nursing Nurses who work at the state Office


“We are trying to get information


of Mental Health (OMH) facilities know the challenges of providing care are much different than those in a hospital setting. To address these challenges, OMH


managers have come onboard with PEF to create a potential mentoring program to help recruit and retain nurses. To accomplish this, all OMH nurses


are being urged to complete a survey which will be emailed to them May 16- 27. Nurses who do not have Internet access at their jobs, such as those at state correctional facilities, will receive the survey by regular mail. PEF Vice President Pat Baker, one of


the union’s leading activists for OMH improvements and PEF’s labor- management chair at OMH, said the idea for the survey developed from the nurses subcommittee of PEF’s OMH Labor-Management Committee.


www.pef.org


directly from the nurses to help improve their jobs,” Baker said. “It’s essential OMH nurses complete and return the surveys so they can have a role in determining the struggles of being a nurse in OMH. We also encourage PEF council leaders and stewards to play an active role in this initiative.” The survey is called “Nurse To


Nurse” and is being designed by the University of Rochester through a Workforce Initiatives grant. “When we received the grant, we


viewed it as an opportunity to address nursing issues in OMH and to work with OMH managers to find solutions to these issues,” said Barbara Rock, co-chair of the nurses subcommittee. “OMH has agreed to allow nurses to


receive and complete the survey during work time. This is really an opportunity for them to share their


thoughts in a constructive way so we can improve working conditions. I see this as a very hopeful experience,” Rock said. If you would like more information


about the survey, contact the nurse administrator at your facility. — Deborah A. Miles


The Communicator May 2011—Page 11


TRUTH BE TOLD – EDITORIAL


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