What is a job creator?

     I am, as usual, concerned about the real content of a word or phrase.  One of those phrases is “job creator”, a term that is used by those who would like to see the tax rate on the wealthiest one percent reduced, or at least kept at its present, historically low level.  The define “job creators” as those people whose income is in the top one percent of United States taxpayers.  What concerns me about using the term “job creator” to apply to all of these people across the board is that there is no real way to tell, simply from the fact that a person has earnings of a million dollars, that that person has actually created jobs in America, or, for that matter, anywhere at all.  After all, the person could be extremely wealthy and is simply living an indolent life supported by income from interest or dividends. 

     What concerned me most particularly was the one tax return made public by the Republican candidate for president, Mitt Romney.  It is one of Romney’s main sales pitches that he is the quintessential job creator, that his wealth has, by his telling, been generated specifically by job creator activities.  What concerned me was that Romney’s tax return contained the information that, for the last ten years, he has been taking advantage of something called the Foreign Investment Tax Credit.  Whatever may be the specifics of Romney’s use of the Foreign Investment Tax Credit, we can most assuredly draw one concllusion:  for the last ten years, Mitt Romney has been heavily invested in foreign economies.  In other words, he may indeed be a job creator, but the jobs that he has been creating have been created in foreign countries.  I have no idea whether the money he keeps in his Swiss bank accounts and his Cayman Island bank accounts are similarly creating jobs in foreign countries, but his use of the Foreign Investment Tax Credit is undeniable evidence of precisely what it says:  Mitt Romney’s investments are, by and large, in the creation of jobs in foreign countries.

     As a pure investment strategy, that is likely quite wise.  The American market has been seriously damaged by the tax and regulation policies put in place from 2000 to 2008.  Foreign economies, particularly that of India and Southeast Asia, are still growing, and, if your interest is in increasing your personal fortune, and in paying as little in United States taxes as possible, then investing in those countries and taking advantage of the Foreign Investment Tax Credit, is definitely a good idea.

     If, on the other hand, you are interested in helping the American economy, if you want to claim that you are a job creator who creates jobs in the United States, investing in foreign economies and then taking advantage of the Foreign Investment Tax Credit, far from helping, actually hurts the American economy, in two ways.  First of all, it creates a job in a foreign country that might have been created here.  Secondly, it reduces the investor’s taxes and so reduces the money the United States government could take in to reduce the terrible deficit that was created in the first decade of this century.

     All this makes it obvious that people of great wealth or large income are not, by the simple fact of their wealth, job creators.  So, who is a job creator?  It is really not all that hard to figure out.  A job creator is a person who, by his or her conduct, causes jobs to exist in the United States.  How are jobs created?  They are created when someone makes or does something in the United States that a lot of people buy.  So, for instance, the Ford Motor Company, by virtue of its recent remarkable renaissance, has added any number of American workers who are putting out a very exciting group of products that are being purchased by consumers in the United States and around the world.  One can think of many such examples, but the example of the Ford Motor Company works to illustrate the point.  Who, then, are the job creators at Ford Motor Company?

     Well, certainly Bill Ford is a job creator.  When the recession hit, Bill Ford went on television and said that he “got it” and that he was going to bend all his efforts to seeing that Ford put out a more attractive product.  He did just that, and he succeeded, likely beyond even his own dreams.  What he did, however, would have been futile, would have failed entirely, if his product had not been properly designed and manufactured and if his product had not been purchased.  So the two other job creators here are at least as important as Bill Ford.  The first are the workers themselves.  If the workers are not diligent and productive, the Ford product is less valuable and more expensive.  American workers have the highest productivity rate in the world.  The American worker is just as much a job creator as Bill Ford, and clearly far more productive than the mere investor who simply sits by and waits for the dividends or increase in the stock price.

     Secondly, and probably the greatest job creator of all, is the consumer.  It is the consumer of the American product that makes the manufacturer add jobs — the more Ford cars that are sold, the more people Bill Ford needs to satisfy the demand.  It frankly drives me crazy to listen to people complain about the lack of American jobs when those people drive around in BMW’s and Audis and Mercedes.  Go through any parking lot and count the number of foreign cars.  I guarantee you that there will be far more foreign cars than American cars.  If you buy American, you will be a job creator, and those jobs will be American jobs.  If all the cars and trucks in America were made in America, there would be no unemployment, no recession, no deficit.

     So who is a job creator?  Well, first and foremost, you are.  Mitt Romney?  Not so much. 

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