He nailed it!
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Creating jobs is easy for government, but all jobs are not equal. Paying people to dig ditches and fill them up does society no good. On balance these “jobs” diminish the economy by wasting scarce land, labor and capital. We do not want jobs for the sake of work, but for the goods and services they produce. As it has a printing press, the government could mandate employment for all, as did the Soviet Union. But if these jobs are not productive, and government jobs rarely are, society is no better for it.
This is also true of the much vaunted “infrastructure spending.” Any funds directed toward infrastructure deprive the economy of resources that might otherwise have funded projects that the market determines have greater economic value. Infrastructure can improve an economy in the log-run, but only if the investments succeeds in raising productivity more than the cost of the project itself. In the interim, infrastructure costs are burdens that an economy must bear, not a means in themselves.
Unfortunately our economy is so weak and indebted that we simply cannot currently afford many of these projects. The labor and other resources that would be diverted to finance them are badly needed elsewhere.
Bears repeating! Great post!!
“”We do not want jobs for the sake of work, but for the goods and services they produce””
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Good point and that is the reason Obama Job Stimulus programs are bad for the economy. Building a statue does not make the United States a more productive country.
It may have kept someone off the unemployment line for a few months, but at the end of the day, we would have been better off just paying the statue maker to stay home and do nothing.
Because once the statue is built, then someone needs to be hired to clean the pigeon crap from the statue’s nose.