Thursday, May 22, 2008

Ohio's Keynesian Revolution

Bad ideas never die, they are simply recycled and repackaged.

Turning their backs on the supply-side economics of Reagan, the Ohio Republicans at the statehouse have embraced the ideals of the FDR Democrats; the Republicans are now trying to spend their way out of recession.

First off, these folks are spending our money on programs that benefit special interests. Not you or me, but those who lobby and contribute to campaigns. That's how government works.

To justify their largess, the Republicans claim that the extra $1.57 billion will create 57,000 jobs over the next five years. Now, it is possible that the spending scheme will create 57,000 jobs, but the Austrian School of economics has shown that at least 57,001 jobs will be lost over the very same period.

Government interventions in the market never create or improve, they simply switch, distort, and enervate.

Taxes exert a huge burden on a rustbelt state, discouraging firms from moving here. Yet, the boneheads at the state -- and in the Republican Party -- believe in taxing and spending.

Keep in mind that government interventions distort economies, always. When the state provides fund for certain programs, investment occurs within those areas. Once government funding stops, those very same areas suffer job loses. This is true because government never spends in areas that are productive. Why? If those areas had any chance of being productive, the areas would have attracted private investment. That's how markets work.

To believe otherwise is to believe that the folks at the statehouse can predict the markets better than the entrepreneur and invester; sort of like believing in the Chimera.

This is why programs, once started, tend to continue: Government fears the "recession" in the sectors distorted by previous government interventions. There is no other way to explain the amount of money wasted on "research" at OSU. The state fears having to lay-off all those researchers who produce nothing of any real value.

In the end, Republicans are now Democrats, taxing and spending. I must have missed the sign that said, "Entering the rabbit hole."

1 comment:

Anonymous said...

Maybe they can hire some professional window-breakers to pump up the economy.