Well, maybe one...
Posted on 07/12/2010 2:55:22 PM PDT by jazusamo
If you could spend vast amounts of other people’s money just by saying a few magic words, wouldn’t you be tempted to do it? Barack Obama has spent hundreds of billions of dollars of the taxpayers’ money just by using the magic words “stimulus” and “jobs.”
It doesn’t matter politically that the stimulus is not actually stimulating and that the unemployment rate remains up near double-digit levels, despite all the spending and all the rhetoric about jobs. And of course nothing negative will ever matter to those who are part of the Obama cult, including many in the media.
But, for the rest of us, there is a lot to think about in the economic disaster that we are in.
Not only has all the runaway spending and rapid escalation of the deficit to record levels failed to make any real headway in reducing unemployment, all this money pumped into the economy has also failed to produce inflation. The latter is a good thing in itself but its implications are sobering.
How can you pour trillions of dollars into the economy and not even see the price level go up significantly? Economists have long known that it is not just the amount of money, but also the speed with which it circulates, that affects the price level.
Last year the Wall Street Journal reported that the velocity of circulation of money in the American economy has plummeted to its lowest level in half a century. Money that people don’t spend does not cause inflation. It also does not stimulate the economy.
The current issue of Bloomberg Businessweek has a feature article about businesses that are just holding on to huge sums of money. They say, for example, that the pharmaceutical company Pfizer is holding on to $26 billion...
(Excerpt) Read more at jacksonville.com ...
There is no free lunch and the biggest price of all is paid by people who are unemployed because politicians cannot leave the economy alone to recover, as the American economy has repeatedly recovered faster when left alone than when politicians decided that they have to “do something.”
A liberal friend of mine just does not get this. He is a Keynesian when it suits him and believes that government spending is the way out of a recession. His feeble logic says that if some spending is good that any and all spending must, therefore be good.
I keep trying to get him to realize that government investment on infrastructure or other capital spending is the only logical way that government spending can stimulate. Giveaways to favored political cronies does not.
You bet...Sounds like your friends mind is pretty much made up but every once in a while a lib comes along that sees the light. :-)
There are a couple of libs that work for me that have moderated somewhat as we get more in-depth on issues. They find that their bumper sticker mentality does not serve them well when they are forced into a logical debate.
Dr. Sowell has been a priceless resource for me in these discussions. He has a way of boiling an issue down to its essence. I have asked my lib friends for a comparable author that voices their views so I can educate myself on their perspective, but they cannot seem to come up with any.
Have you ever run across an author that presents the liberal economic case in a well though out, logical way? I'm not trying to be funny here. I really would like to try to learn something.
To be honest I don’t read too many libs but the ones I have are not even close to putting forth their views as Dr. Sowell does his. Of course they’re handicapped to begin with by trying to make truth of fantasy. :)
Sowell can say in a few sentences and make it clear what most take several paragraphs and many times they still don’t get the idea across.
Well, maybe one...
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