Why Don't the Facts Seem to Matter Anymore?
How do Americans make up their minds on political issues? Some, I’m sure, simply echo the positions of trusted friends. There are people who are persuaded by specific arguments that just seem to personally resonate and still others who simply adhere to strict party lines. Such practices are understandable in the fast paced world of 21st Century America. But understandable or not, one has to wonder if a more deliberate approach might be warranted.
Take for instance the current debate over the extension of the Bush tax cuts. Most polls previously showed that the majority of voters support extending the cuts for only the middle class. But the margins were remarkably thin and continue to shrink.
The most recent Gallup poll shows only 44% of participants in favor of extensions depending upon income level and tallied 40% in support of cuts regardless of income. An Associated Press poll of 1,000 people, taken just before Thanksgiving, showed a slightly larger margin, with 50% in favor of cuts for income up to $250,000 and only 34% favoring cuts for all income.
Division of this sort is typical on political issues, but what’s interesting about these results is that, while only 2% of Americans would benefit directly from cuts on income above $250,000, a third or more of those polled consistently support those very cuts. This is an atypical disparity that surely must have some explanation.
One possible motivation could be that people are concerned about jobs. According to that same AP poll, 82% of participants cited unemployment as an “extremely” or “very” important issue. Perhaps these people believe that extending tax cuts to the wealthy will result in job creation. After all, anyone who’s listened to the media has heard this argument. It’s a favorite of congressional Republicans, who regularly cast any tax increase as “job killing.”
But the fallacy of such a premise is immediately evident in even the briefest moment of serious contemplation. The fact is that employers simply don’t hire based on their personal income tax treatment. The formula for staffing is strictly limited to the number of employees required to produce the product or provide the services necessary to meet demand while maintaining a profit — period. Profits must be made before taxes even come into play. The fundamental rule is that, if demand goes up, businesses must hire more people, and if demand wanes, there will be layoffs.
I’m afraid that while the don’t-tax-the-job-creators line seems to have some legitimacy on the surface, nobody who’s actually studied the issue believes it. Economists are all forced to agree with Cornell University’s Robert Frank, who sums up the present situation with “Businesses aren’t investing because they can already produce more than people want to buy.” Indeed, the nonpartisan Congressional Budget Office (CBO) produced a report on the matter and concluded that, of the top 12 suggestions for spurring job creation, income tax cuts was the least effective option.Continued on the next page