Discussion World Forum  


Go Back   Discussion World Forum > Discussion Forums > Economics

Economics The economy, taxes, Federal Reserve, Central Banks, inflation, interest rates, unemployment, stock markets, currency, GDP, NAFTA, IMF, WTO, GATT, etc.

Reply
 
Thread Tools Display Modes
  #11  
Old Aug 27th 2009, 02:37 PM
Michael's Avatar
Michael Michael is offline
Administrator
Herder of Cats
 
Join Date: Oct 2008
Location: Toronto
Posts: 14,835
Default Re: GM still out to lunch

Quote:
Originally Posted by Americano View Post
Has anyone bothered to see if tax revenue from the sale of those cars and the economic flow-through will cover the public subsidy? Or is it just another attempt to contain lagging GDP growth?
My quick 'back of the envelope' calculations based entirely on the 1350 jobs GM said they were restoring suggests that the payroll & income taxes on those jobs will cover the cost of the program (easily) within one year (if those 1350 jobs stay alive for 12 months).

This of course ignores the fact that auto-manufacturing jobs have one of the highest possible job multiples in the US economy - meaning that for every job in auto-manufacturing, there are three support jobs. Thus, the restoration of those 1350 GM jobs means some 4000 other supplier jobs as well (and they pay taxes too).
Reply With Quote
  #12  
Old Aug 27th 2009, 05:46 PM
dilettante's Avatar
dilettante dilettante is offline
Moderator
Resident Historian
 
Join Date: Oct 2008
Location: Philadelphia
Posts: 3,082
Default Re: GM still out to lunch

Quote:
Originally Posted by Michael View Post
My quick 'back of the envelope' calculations based entirely on the 1350 jobs GM said they were restoring suggests that the payroll & income taxes on those jobs will cover the cost of the program (easily) within one year (if those 1350 jobs stay alive for 12 months).

This of course ignores the fact that auto-manufacturing jobs have one of the highest possible job multiples in the US economy - meaning that for every job in auto-manufacturing, there are three support jobs. Thus, the restoration of those 1350 GM jobs means some 4000 other supplier jobs as well (and they pay taxes too).


It's a $3 billion program. Those 1350 jobs would have to contribute an average of $2,222,222.23 each in taxes to cover it in one year. Even with added 4000 supplier jobs, that's still half a million dollars per job.
Reply With Quote
  #13  
Old Aug 27th 2009, 06:02 PM
Americano's Avatar
Americano Americano is offline
Globetrotter
 
Join Date: Oct 2008
Posts: 8,614
Default Re: GM still out to lunch

Quote:
Originally Posted by dilettante View Post


It's a $3 billion program. Those 1350 jobs would have to contribute an average of $2,222,222.23 each in taxes to cover it in one year. Even with added 4000 supplier jobs, that's still half a million dollars per job.
All those jobs were call-backs to facilitate a spike in production from the subsidy, which means they go away. It's just another band aid on a chest wound.
Reply With Quote
  #14  
Old Aug 27th 2009, 06:41 PM
The Drunk Guy's Avatar
The Drunk Guy The Drunk Guy is offline
Bad Motherfucker
 
Join Date: Nov 2008
Location: 'Round back
Posts: 2,339
Default Re: GM still out to lunch

Quote:
Originally Posted by dilettante View Post


It's a $3 billion program. Those 1350 jobs would have to contribute an average of $2,222,222.23 each in taxes to cover it in one year. Even with added 4000 supplier jobs, that's still half a million dollars per job.
So, giving each employee $50k a year for ten years would have been easier?
__________________
Vae, puto deus fio...
Reply With Quote
  #15  
Old Aug 27th 2009, 07:01 PM
Michael's Avatar
Michael Michael is offline
Administrator
Herder of Cats
 
Join Date: Oct 2008
Location: Toronto
Posts: 14,835
Default Re: GM still out to lunch

Quote:
Originally Posted by dilettante View Post


It's a $3 billion program. Those 1350 jobs would have to contribute an average of $2,222,222.23 each in taxes to cover it in one year. Even with added 4000 supplier jobs, that's still half a million dollars per job.
Obviously I slipped a couple of decimal places!
Reply With Quote
  #16  
Old Aug 27th 2009, 09:10 PM
Americano's Avatar
Americano Americano is offline
Globetrotter
 
Join Date: Oct 2008
Posts: 8,614
Default Re: GM still out to lunch

Quote:
Originally Posted by Michael View Post
Obviously I slipped a couple of decimal places!
That doesn't include the interest to service the debt. This is true crisis management with an unending procession of smoke and mirrors to entertain the general public.
Reply With Quote
Reply

Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Forum Jump


All times are GMT -4. The time now is 06:11 PM.


Powered by vBulletin® Version 3.7.2
Copyright ©2000 - 2019, Jelsoft Enterprises Ltd.
Copyright 2008 - 2017, DiscussionWorldForum.com