Letter: Business Sits On Its Capital

I find it fascinating that people of great wealth are reluctant to invest capital into businesses until they are sure the demand is there, and the demand that they need to see can’t be there until consumers have more income to spend.

We have had a recovery in which the rebound in jobs didn’t happen and many businesses face the law of diminishing returns. It’s a bit ironic that those who became wealthy in times of uncertainty have lost faith in their own character and can’t seem to connect the dots.

Articles in both Forbes and the Wall Street Journal suggests that many investors are sitting on huge piles of capital, idle sums that could aid in recovery, but their reluctance to engage recovery appears to be political and not fiscal.

The proposition or idea that such reluctance is based on unfair or high taxes on the wealthy and the only way to see job growth is by lowering taxes further on job creators, who are not creating jobs when the tax level is the lowest in 20 years, belies the premise.

Globalization and bad trade agreements have disadvantaged the American worker, who had been the primary consumer and partner to American business.

Trade agreements which have created great wealth for some have left many American workers, especially semi-skilled workers, competing with cheap foreign workers in 39 countries under NAFTA, who earn less than $2 a day and for whom American businesses are encouraged to help by earning a tax credit for every job sent overseas.

What we need is for American businesses to recognize that American workers often are asked to defend our country, ergo American businesses here and abroad, and value them in a new perspective. We need government to stop giving tax credits for jobs created overseas and give American businesses a tax credit for every job created in the United States. The obvious irony in tax credits for jobs created overseas is that the American worker, through his taxes, is actually subsidizing his own demise.

Richard Nielsen, Royal Palm Beach