A Dissent on the New Jobs Tax Credit
Pete Davis worked on one of the last New Jobs Tax Credits to come through Congress. He's not happy to see it return:
Washington likes quick fixes to big problems. Unfortunately, quick fixes rarely benefit the economy. In 1977, in behind-the-scenes discussions with members of Congress, I argued against the New Jobs Tax Credit. It was obvious that the credit would reward new hires long after the decision to hire had been made for other reasons. We spent $5.7 billion of taxpayer money on it anyway so political leaders had something to show the voters back home. No new jobs were created, although proving that is almost impossible.
For those who want more background, Davis points to an excerpt from The Economics of Taxation, where Jimmy Carter's top tax economist, former deputy assistant treasury secretary Emil Sunley, recalls the debate over the tax credit. You can download it here.
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