Column on Here We Go Again

Here We Go Again

Tibor R. Machan

Innumerable
arguments and research have been produced showing that government
stimulus is useless.  Despite what President Obama and his cheerleaders
in the academy, like Princeton’s Paul Krugman, seem to believe (or at
least say), there is no evidence that government stimuli do anything to
restore market activities.  Such policies merely take funds from the
right pocket and put it into the left while most often the transfer
entails wasting a lot of resources so the net effect is widespread
economic loss.  

Just
consider the current administration’s plan to funnel billions into
public works projects–building roads, improving rail lines, beefing up
public parks, etc., and so forth.  The funds come from someplace, right?
 Even if they are borrowed from China and future generations of
Americans, there will be a minus sign somewhere on the ledger.

So
what then is happening to provide a net gain?  Nothing.  The multiplier
effect is a myth–one just cannot make something from nothing however
much one might wish to do so.  Thus some enterprises that would have
been funded by the monies spent as stimulus will be unfunded; customers
will have fewer dollars to spend, banks fewer dollars to lend, firms
fewer to borrow, all because the politicians have decided to divert it
all to projects they deem worthy.  But what about projects that those
deem worthy who have to be coerced so as to pay for all this?  

Whenever
one has funds extorted so as to artificially pay for improving
highways, etc., one will no longer have them available to spend down at
the mall or grocery store or one’s brokerage.  Where is the stimulus
here instead of the mere forcible redirection, something that will
mostly mean spending on what the taxpayers didn’t want to spend on?  Why
is what the politicians choose to do with one’s funds more stimulating
than what one would do with them?

This
seems to be no more than a shell game, at best, or out and out fraud.
 Making it appear that politicians are doing something about the dire
straits a large number of citizens are experiencing.  But it is a
mirage, nothing real.  Again, one cannot get something from nothing and
to make it appear one can, the net effect is gross waste.  You rob me to
support something you want so I don’t get to support what I want; but
then I need to make provisions to replace the stolen stuff and you had
to exert energy on the theft instead of on something productive. Nothing
about it is an economic plus.

Most
of the truth of this is hidden behind a lot of talk of what “we” are
doing.  But there is no “we” involved, only you, I, and the others who
get rooked by it all.  The United States of America is not a firm but a
country. When politicians treat it otherwise they must engage in
malpractice.  Their job is to provide a setting for us to do productive
work, not to embark on various ventures as some kind of corporate giant
that keeps borrowing and borrowing but has run out of collateral.
 Somehow this point is being missed all over the place and journalists
who are supposed to hold the politicians’ feet to the fire are failing
to get to it during all their Sunday interview programs.

Whenever
people’s property rights are violated by all the taking and regulating
and redistribution done by the politicians what is involved is removing
the people from the position of being able to choose, to allocate their
labors and resources, and substituting the politicians and the
bureaucrats for this role.  Just why these folks are believed to know
better is a mystery, other then that perhaps most citizens are still in
the grips of the governmental habit inherited from the times when kings,
czars, pharaohs and other rulers were supposed to know it all, with
everyone else just following orders.  

Yet
that is precisely the system that was overthrown by the American
Revolution!  So why do so many Americans still believe in it? Why do
they want to imitate Europe and other parts of the globe that American
said “no” to in the first place?  Go figure.

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