If You Want to Create Jobs, Stop Penalizing People for Creating Jobs

(Assemblyman Ed Goedhart) – Because some in government apparently still don’t get it, let me state the obvious: If you want to lower the unemployment rate, the private sector needs to create new jobs – and if you want the private sector to create new jobs, the job of government is to create the kind of pro-business environment that encourages the private sector to create new jobs.

This isn’t exactly rocket science. Or even brain surgery.

Yet in the midst of The Great Recession – with Nevada leading the nation in unemployment – what did our state Legislature do last year? It doubled the fine (OK, fee) major employers are penalized with for hiring somebody. It was perhaps the dumbest thing I’ve seen some of my colleagues do in the two sessions I’ve spent in Carson City. And I’ve seen them do some pretty dumb stuff.

If you really want to encourage job creation, the Legislature should REPEAL the modified business tax, not double it.

Adding insult to injury is the fact that not only has the penalty for hiring employees doubled, but the state Employment Security Council recently voted unanimously to hit employers with a 50 percent increase in the tax they pay to fund unemployment benefits starting on January 1.

Wait a minute. Why is an unelected council voting to increase taxes on Nevada businesses? Isn’t that what we elect state legislators to decide?

Well, actually they didn’t vote to impose the tax hike. They voted to recommend the tax hike to Employment Security Administrator Cindy Jones, who will reportedly make a decision to accept or reject the recommendation to raise this tax on December 7th. However, the Las Vegas Review-Journal has reported that “no administrator ever has gone against the council’s wishes.”

Wait a minute. Why is an unelected bureaucrat making a unilateral decision on raising taxes on Nevada businesses? Isn’t that what we elect state legislators to decide?

Which brings up another point: Raising taxes on battered businesses, which already have enough problems, isn’t the only potential solution to the hole we’ve dug by borrowing money from the federal government to pay for unemployment benefits. Six other states reportedly are floating low interest rate bonds to pay off their higher interest rate federal debts, an option that would require legislative approval.

So…

Absent some compelling legal requirement I don’t know about, I urge the unelected Employment Security Administrator to reject the recommendation of the unelected Employment Security Council to raise taxes on our business community in January and let the elected members of the Nevada Legislature deal with this problem when we re-convene in February.

(Assemblyman Goedhart represents Assembly District 36, a rural district generally covering southern and middle Nevada.)