In January 2008, the United States economy employed 138.1 million people and the unemployment rate stood at 4.9%. But the powers in Washington thought deficit spending could boost a slowing economy, so Speaker Nancy Pelosi (D-CA) passed and President George Bush signed a $168 billion economic stimulus bill made up of temporary tax cuts and increased mortgage grantees for Fannie Mae and Freddie Mac. By January 2009 that economic stimulus worked so well that the US economy had lost 3.5 million jobs and the unemployment rate stood at 7.6%. Again the powers in Washington thought deficit spending was the answer, so Speaker Pelosi and newly minted Barack Obama dialed up $787 billion in temporary tax cuts and permanent spending increases. Ten months later, the US economy has now shed another 3.59 million jobs and the unemployment rate stand at 10%.

Undeterred by the complete failure of their past job creation efforts, leading leftist luminaries are again calling on the liberal majorities in Congress and Obama to approve billions more in government spending for a third stimulus. Last week, Obama hosted a “jobs summit” where academics, union leaders, and select big business leaders made their pitch for government largess. Among the ideas reported: Teamsters leader James Hoffa called for higher barriers to trade, Obama insisted that all future aid to states go to preserving government jobs and not tax cuts, and others pushed to bring the “success” of Cash for Clunkers to a new Cash for Caulkers program.

These “new” ideas will fail for the same reason the past two government stimulus plans failed: governments do not create jobs. Only the private sector in pursuit of opportunity can create jobs on net. The best we can hope from government is that it keeps to a minimum the jobs it prevents and the income and wealth it destroys. Obama does not understand this. At the job summit, Obama lamented the lack of job creation:

“There’s a lot of money on the sidelines in the private sector. They are still nervous about whether they want to go ahead and take the risks that are inherent in a free market system.”

Wrong. Businesses aren’t nervous about “the risks that are inherent in a free market system,” they are nervous about the risks inherent in a government regulation dominated economy. Fred P. Lampropoulos, founder and chief of Merit Medical Systems Inc., told Mr. Obama that businesses were uncertain about investment because “there’s such an aggressive legislative agenda that businesspeople don’t really know what they ought to do.” That uncertainty, he added, “is really what’s holding back the jobs.”

In short, the president’s “stimulus” package, which was supposed to cap unemployment at eight percent, failed horribly. This is because “every dollar Congress ‘injects’ into the economy must first be taxed or borrowed out of the economy,” explains Carroll. Therefore, the more the government spends, the more taxes Americans will have to fork over to Washington. This is exactly what we’re seeing now.

Since taking office, Barack Obama has proposed massive new taxes on our ailing economy, explains Heritage tax policy analyst J.D. Foster. These taxes may come in many different forms but each of them will eventually affect every American:

Energy Tax: Cap-and-tax climate change legislation would cause energy prices to “necessarily skyrocket,” as even President Obama admitted. This would cost the average American family an additional $3,000 each year.

Officials gather in Copenhagen this week for an international climate summit, but business leaders are focusing even more on Washington, where the Obama administration is expected as early as today to formally declare carbon dioxide a dangerous pollutant. This is the stuff humans exhale. While the global warming hoax has finally come full circle and the liars have been exposed the House Committee on Energy Independence and Global Warming held a hearing on what Chairman Ed Markey said was “the urgent consensus view . . . that global warming is real, and the science indicates it is getting worse.” But the only witnesses were officials from the Obama administration, who support dramatic action on climate change. Republicans asked to have a global-warming skeptic appear but were denied.

Committee Republicans nonetheless gamely read excerpts from the East Anglia emails and asked the witnesses about them. “These emails show a pattern of suppression, manipulation and secrecy that was inspired by ideology, condescension and profit,” claimed Rep. Jim Sensenbrenner of Wisconsin.

John Holdren, President Obama’s science adviser, held firm, saying the disputed scientific research mentioned in the emails is a small fraction of the total research on climate change. He defended a 2003 email he wrote to one of the East Anglia scientists in which he had ridiculed global warming skeptics. The Wall Street Journal provides a sample of the East Anglia emails that are part of a worldwide scientific and political coverup rather than truth.

Rep. Jay Inslee, a Washington Democrat, tried to make light of the emails by saying they weren’t stopping the Arctic from shrinking, oceans from getting more acidic, and glaciers from melting. He sarcastically asked Mr. Holdren if he was part of a giant worldwide conspiracy that included fictional movie villain organizations bent on dominating the planet. Mr. Holdren, playing along, denied being part of such a conspiracy.

An “endangerment” finding by the Environmental Protection Agency could pave the way for the government to require businesses that emit carbon dioxide and five other greenhouse gases to make costly changes in machinery to reduce emissions — even if Congress doesn’t pass pending climate-change legislation. EPA action to regulate emissions could affect the U.S. economy more directly, and more quickly, than any global deal inked in the Danish capital, where no binding agreement is expected.

More government regulation and the myth of green jobs is simply one more political

Health Care Tax: Funding a Washington takeover of the health care industry, which represents one-sixth of our economy, will require massive new taxes from individuals, families, small business and employers.

We have now reached the stage of the health-care debate when all that matters is getting a bill passed, so all news is good news, more subsidies mean lower deficits, and more expensive insurance is really cheaper insurance if you believe the ficticious headlines:

“No Big Cost Rise in U.S. Premiums Is Seen in Study,” said the New York Times, while the Washington Post declared, “Senate Health Bill Gets a Boost.” The White House crowed that the CBO report was “more good news about what reform will mean for families struggling to keep up with skyrocketing premiums under the broken status quo.”

Congressional Budget Office is confirming that new coverage mandates will drive premiums higher, but Democrats are declaring victory, claiming that these higher insurance prices don’t count because they will be offset by new government subsidies. Subsidies that will increase the national deficit as demonstrated below.

More Deficits and More Debt: The President’s ever-expanding budget will likely produce $13 trillion in deficit spending over the next 10 years, which is a debt Americans will have to pay.

These massive taxes create a poor environment for economic growth. But there are alternatives, like lowering tax rates to encourage investment. As Foster explains, “If the President wants the economy to create more employees today, then he has to stop threatening the employers with taxes, red tape, and a bleak future.”

The administration and its Congressional allies have been presented with numerous opportunities to cut tax rates — such as the highly unpopular death tax — and thereby permit greater economic prosperity. Nonetheless, the House voted 225 to 200 to “kill job creation again” by making the current estate tax rate permanent rather than completely abolishing it in 2010, as was planned.

The only thing the politicos in Washington could do to create jobs and return the economy to a robust model is to come back from the holidays in 2012 or later. Indeed!