Stimulus Bill Passed In Vain Effort
Let us falsely assume for a moment that government spending and debt are "stimulative". Let us also believe the fear mongering and flat out lie committed by our President yesterday saying that this is the worst economy since the great depression. (I guess he forgot the early 80’s where inflation and unemployment were both in double digits, the oil embargo of the 70’s, etc, etc)
If that is all true, then why is a sizable portion of this “stimulus” package not even slated to be spent until after October of 2010 according to the CBO? That won’t have an affect on our currently “dire” situation, but it will be a nice boon for Congressmen seeking reelection the next month.
Back to government spending as stimulus... That’s Keynesian theory and has been rebuked and proven false more times and in more countries than I can name. Use logic for a moment. For every billion dollars that the government spends on a project determined worthy by some bureaucrat whose job depends on coming up with these things, there is a billion dollars that must first be taxed out of the economy. (Unless the government simply prints it, devaluing currency, and leading to inflation…the hidden tax) For every ditch the government wants dug, there exists an infinite opportunity cost of what could have been done with the money if left in the private sector to begin with.
When the ditch is dug, and the government trough is again empty, that person is back out of a job and the total economy hasn’t been improved or changed in any meaningful way. If anything, it’s been made worse by the new debt obligations of the government.
For this economy to improve; the ability, ingenuity, resourcefulness, and incentive of the American people to achieve their own ambitions needs to be reawakened. A business creating a job has a tremendously greater long term impact than the government doing so. Growth is only sustained via free people participating in open commerce determined by their own thoughts and wishes…not those of the government.
By stripping away freedom in favor of macro and micro-economic manipulation by some lone government official who wants millions of dollars to install doorbells in Mississippi (true part of the stimulus), we are shortchanging ourselves and stripping out the vast potential this country, as a free country, has to offer the world. Oh, we’ll grow alright, with or without this “stimulus” plan, but with it the growth will be slower and the ceiling of economic prosperity will be lower.
Ronald Reagan shared some prophecy for the moment in his 1981 inaugural address. Here are some clips:
"You and I, as individuals, can, by borrowing, live beyond our means, but for only a limited period of time. Why, then, should we think that collectively, as a nation, we're not bound by that same limitation?"
"In this present crisis, government is not the solution to our problem; government is the problem. From time to time we've been tempted to believe that society has become too complex to be managed by self-rule, that government by an elite group is superior to government for, by, and of the people. Well, if no one among us is capable of governing himself, then who among us has the capacity to govern someone else? All of us together, in and out of government, must bear the burden. The solutions we seek must be equitable, with no one group singled out to pay a higher price."