My corporation M V Consulting, Inc. Click image to learn more about me

Most recent blog post at Vass

If you have interest in becoming a contributing writer to either the Black Entertainment USA or Vass blogs please go to the contact page for more information. All accepted writing contributions become the limited property of M V Consulting, Inc. for use on it's sites.

Senator Gillibrand on New York State economy

Yesterday Senator Kirsten Gillibrand was in Binghamton to discuss that small businesses might survive in the current economic downturn. There were several ideas that Sen. Gillibrand suggested

"When it comes manufacturing, when you have manufacturing here you can innovate better here when manufacturing is divorced the next generation of innovation is going to be done where it is manufactured so we will lose those jobs forever."

Senator Gillibrand was also recently on the radio (WWRL) to furhter expand on her ideas to help Upstate New York.

Let's think about just the business aspect of what Senator Gillibrand has said. Keeping manufacturing in New York and the creation of tax credits and loans.

A tax credit is a great idea, if you have the money. It was one of the key concepts of the Obama Stimulus. That businesses would be able to offset part of the cost of new employees with tax credits, making hiring more affordable.

Loans were another idea of the Obama Administration. It too was part of the Obama Stimulus. Billions were put in place for banks and credit unions to give loans to small businesses so they could expand.

Thus the net of the ideas of Senator Gillibrand appears to be more of what has already been put in place since February of 2009.

That concept, in effect for a year, has had a definitive effect on New York State. Unemployment increased to 8.6% as of December 2009 in the Broome County area alone. As of the most recent report, unemployment currently stands at 9.7% for Broome County. For the State the figures are (after being seasonally readjusted) 7.1% January 2009, 8.9% December 2009, and 8.8% January 2010. Comparing 2008 to 2009 the unemployment rate for the State increased by 58.1% to 813,400 in 2009.

Perhaps the most telling stat is the number of underemployed which counts total unemployed, plus all marginally attached workers, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all marginally attached workers. That figure works out to be 14.3% for New York State in 2009 versus 9.6% in 2008, and 8.1% in 2007.

Somehow, businesses are not improving and many have left the State. Loans have been created, funds allocated, grants granted. Why has there been a net reduction if the plans that Democrats, Senator Gillibrand, and President Obama have championed are so great?

Maybe the fact that taxes continue to increase is a factor. Drawing more money from businesses of all sizes just to pay taxes leaves less for expansion or even staying even. Add to that the fact that to get a grant or loan a business must meet specific government restrictions, and fill out more than a few forms that are hardly simplified, then survive and wait for approval if they will receive it. Thus making the number of people that qualify a small pool, and those receiving the money even smaller. Add to that the fact that tax credits require upfront money that the government does not help with, as mentioned above.

Another item that Senator Gillibrand failed to mention was her support of the Health Care Reform Bill and Cap & Trade. The Health Care Reform Bill increases taxes on businesses, as well as taking funds out of the pockets of citizens mandatorially. The Cap & Trade Bill proposed to skyrocket energy costs by 150% or more, for businesses and individuals. Which then limits the funds to hire workers, plus limiting the funds consumers have to buy the higher priced goods.

Faced with one of the highest taxed States in the nation, proposed increases in energy costs, potentially iminent increases in costs due to the Health Care Reform, and fewer purchases from a growing number of consumers that are underemployed and thus incapable of buying, do loans and tax credits sound like a stimulative action?

Senator Gillibrand sounds positive. The ideas sound like they can have an effect. But when you stop to really look at what has been proposed and the effect it has had in the past, the question becomes why do more of the same?