GOP: The New Nazi Party!
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Posted on July 17, 2011 at 10:37 AM in American Crisis, Economy, Politics, Technology, U.S. News | RSS feed
“Just $275 billion”: Just?! What amount did you suggest? $1,000 billion?
“created or saved millions of jobs”: At what cost? Compared to what? What hard evidence do you have?
Well, exactly. The hardest evidence we have so far suggests that the stimulus “created/saved approximately 450 thousand state and local government jobs and destroyed/forestalled roughly one million private sector jobs”—i.e., on net destroyed, not created, more than half a million jobs.
Doctors’ principles traditionally start with “first, do no harm”. Maybe the government should try that.
The hardest evidence we have so far
That should read “the only evidence we have that supports the right-wing ideology.” Economics is an inexact science at best, if you can call it a science. Their models almost always fail and their predictions are about as reliable as a Yugo with 200,000 miles on it.
If you think that sort of thing is unknowable, then on what basis did you claim that the stimulus had “created or saved millions of jobs” in the first place?
You don’t know the difference between predicting what might have happened and reporting what did happen?
What exactly was your basis for claiming that the stimulus had “created or saved millions of jobs”? Which of these two categories do you think that belongs in?
States that received stimulus money have had to report how that money was spent and the number of people hired. Federal projects have a record of how the money was spent and number of people hired. From those jobs, there is also a multiplier effect. The newly employed or those whose jobs have been saved have that money to spend, which creates more demand.
Your economic theory is just that: theory. Like creationism, it has no basis in reality.
Actually, I see that Suissecon’s blog already contains a great summary of why such stimulus spending will necessarily do more harm than good:
“Whenever the government decides to ‘create jobs’, the decision implies rising government spending. The money needed is either borrowed or collected through taxes. In both cases, the same money is no longer available in the private sector. Thus, even if state-run programs create some new jobs, this is done at the expense of other, private-sector jobs. The net effect is almost certainly in the negative.”
the same money is no longer available in the private sector.
Could you explain that inane comment?
Do you really want to understand?
The money for the stimulus, or any government spending, isn’t magical free money; it has to come from somewhere. Suissecon is pointing out that it is taken out of the private sector; that’s where it comes from. Whether it’s confiscated through taxation, or borrowed from investors who might otherwise have invested that same money in private businesses, it’s being taken out of the private sector either way. Which part don’t you understand?
Suissecon is pointing out that it is taken out of the private sector;
It’s not “taken out of the private sector.” It’s all just borrowed money, and the “investors” are other countries who loan us the money. But it puts money into the economy when private firms are given contracts to perform the work, which provides jobs, which gives people income and money to spend.
What do you think that money would be doing if it weren’t being invested in government bonds? It would be invested elsewhere, which means that it would be providing jobs and giving people income to spend; so you can’t consider that an advantage of stimulus spending over the government’s doing nothing, because the money is put “into the economy” in that sense under either scenario. The difference is that under the stimulus scenario, it’s the government, rather than the free market, that determines how to allocate the investment, which means that it will generate a lesser return, not to mention that some of the money will be lost, in the government’s hands, along the way (if nothing else, the government employees overseeing this transfer of money have to be paid for their work), which makes it less efficient.
In other words, as Suissecon said more succinctly, “stimulus” spending is almost certain to have more cost than benefit.
It would be invested elsewhere
There is absolutely no evidence to suggest that’s the case.
OK, so, in summary, if we try to figure out how things work using abstract reason, “There is absolutely no evidence . . . .” If, on the other hand, I provide evidence (from serious economists studying the question), then “Economics is an inexact science at best, if you can call it a science,” and “Your economic theory is just that: theory. Like creationism, it has no basis in reality.”
Meanwhile if you offer hearsay of hearsay about how many people may have been hired (or jobs “saved”) with stimulus money, without even claiming to take into account (on the other side of the ledger) the cost to the economy of where that money came from, that’s all the evidence we need. If you talk about the “multiplier effect” of that spending, without even claiming to take into account the multiplier effect that that money would have had if it had been left in the private sector, that’s very sound theory.
I’m checking out. We’re just repeating ourselves at this point.
the multiplier effect that that money would have had if it had been left in the private sector
That makes no sense whatsoever. Nobody’s taxes were raised to pay for the stimulus. Corporations are making record profits. So what are you talking about?
The only thing you’ve done is provided evidence that right-wingers are living in some alternate reality.
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