Tuesday, November 24, 2009

Hey Gov: Unemployment tax UP = Jobs Down

Ok, once again, Phil Bredesen and Matt Kisber do NOT CREATE jobs. They negotiate in complete and total secrecy with large corporations to see how many of our tax dollars it will take to bribe these corporate pirates to locate a factory in Tennessee instead of the State of some other Governor who is willing to give away even more of their taxpayer's dollars.

Once the secret negotiations are completed Phil and Matt announce to the legislators and taxpayers how much of OUR money they have given away. That is NOT job creation. It is job shuffling in order to create political capital.

The people who DO CREATE JOBS in Tennessee are all the existing businesses who pay taxes year after year. When they pay more in taxes they have less to hire new employees and yet...Phil wants to raise the unemployment tax. This will DESTROY jobs in Tennessee.

WASHINGTON – As if small businesses needed another reason not to hire, consider their latest financial burden: The cost of rising unemployment itself.
Employers already are squeezed by tight credit, rising health care costs, wary consumers and a higher minimum wage. Now, the surging jobless rate is imposing another cost. It's forcing higher state taxes on companies to pay for unemployment insurance claims.

Some employers say the extra costs make them less likely to hire. That could be a worrisome sign for the economic recovery, because small businesses create about 60 percent of new jobs. Other employers say they'll cut or freeze pay.

Drastic increases in the tax, like those on tap for next year, could force struggling businesses to dump more jobs, maybe even go out of business.

That will produce less unemployment tax revenue and more people asking for jobless benefits. At best it will discourage new job creation, so desperately needed.

The increase is triggered automatically by a drop in the state's Unemployment Compensation Trust Fund, which had more than $1.3 billion last year but dropped to zero in August as the jobless rate soared.