Ritchie today

\”Tax pays for new jobs\”.

Well, yes, no one doubts that the spending of tax money creates jobs. Even new jobs.

Where it gets more complex is that similarly no one (umm, no one actually clued in this is) doubts that the raising of taxes kills jobs, both new and old.

If we\’re to concern ourselves solely with jobs (we shouldn\’t, there are other things to think about as well but let\’s pretend) then what we want to do is hit the sweet spot. Where the number of jobs created by the spending of the tax money raised is greater than the number of jobs killed or not created by the tax raised.

Pretty standard marginal analysis from the neo-classical school but of course Ritchie doesn\’t do that, the neo-classicals are all wet, aren\’t they?

5 thoughts on “Ritchie today”

  1. So quantity trumps quality: new jobs are a good thing, even if the job doesn’t need doing.

    We might as well pay people to dig holes beneath the high tide line.

  2. In Oman, they pay people to wash the crash barriers on the highways. By hand. But then, they can afford to.

  3. tax pays for new jobs – yes – but in the bloated public sector whilst also funding those final salary pension schemes – also in said public sector.
    Murph refused to post above so I guess there must be some unpalatable truth in it

  4. “Where the number of jobs created by the spending of the tax money raised is greater than the number of jobs killed or not created by the tax raised.”

    For any non trivial period of time, there is no such sweet spot.

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