I read an editorial this morning that really put a number to why I think this whole stimulus concept we are getting from our elected officials is crap… and much worse the whole “New New Deal” thing Obama is pushing.
When a private employer offers a job and the offer is accepted, the welfare of both the employer and employee is improved. The employer has a new worker who will make the company more productive and the worker has a job to meet his needs.
But when a government job is filled, a third party is involved, and the welfare of that party — the taxpayers who pay the public employee’s salary — is harmed and the economy ultimately damaged.
It’s hard to make a reasonable argument that the country needs 22 million public sector employees. With a total population of 304 million, that’s one government worker for every 14 Americans.
The full editorial is really worth the read, but that is the part I wanted to point out. For every 14 Americans there is 1 government worker. There are more workers in government than in manufacturing! So wouldn’t real economic stimulus be in reducing the size of our government? This would reduce the cost of operating along with freeing up resources that would actually contribute to the economy in general.
Sadly, I see the reverse being far more likely in our new administration. (Bush really didn’t have any redeeming qualities in the smaller government area either – so certainly not a partisan argument there.)
It has been projected that less than half of the stimulus money Obama is planning on “pumping into the economy” will be spent in the next two years. So my question is: Then what is the freaking point??? If it is going to be too late to be effective, then is it really needed? The answer is no, but with a big government “spend our way out of our problems” looming, I am guessing it will happen regardless of whether or not it is a good idea. (See Rob’s post on the issue.)
The whole point is that the government is increasing its drain on the economy – not stimulating it. Bailouts, stimulus packages, etc are making an exploding national debt worse. In this drives inflation and not only will it not really help in the short run, will quite possibly make things much worse in the long run.