Asherdelampyr -> RE: Your Stimulus Money at Work (6/16/2009 6:52:18 PM)
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ORIGINAL: Libertaire quote:
ORIGINAL: Ialdabaoth quote:
ORIGINAL: Libertaire Many governments claim that they are pumping money 'into' the economy. What they seem to forget is where the money came from, if not from the economy through taxation. The person who thinks that these policies actually work must also accept that the government understands where investment should take place. These people are ignorant of the economic calculation problem and the failures of economic planning as espoused by both socialist and keynesian economic policies. You know what "pump" means, right? This is about wealth circulation, not wealth creation (and no, not wealth redistribution either.) The thing is, money is useless if it's not flowing through the economy. So, to get it moving again, you siphon it out of some areas and blast it through others high-pressure. Once the stagnation clears up, it all rights itself. Yes, that means spending money you wouldn't otherwise think you could afford to sometimes. And therein lies the problem. If these jobs do not actually create wealth then what use are they? If they are not creating extra taxable income and stimulating further wealth creation, they are useless. Indeed, wealth creation is stimied by the very tax that was used to collect these funds. You also assume that the government knows where exactly to invest these funds at any given time. History has shown that governments do not know how best to invest capital, as we have seen in command economies. What this has lead to now is a policy of massive deficit spending, supported by a policy of quantitative easing (printing money out of thin air) which can only lead to inflation by the end of this year. They are creating jobs but is that really a good arguement? What jobs are being created? what are the pay rates of those jobs, what is the length? I have done tons of projects that lasted a month, its nice but not really the same as a perm position. I dont know shit about eco-tunnels, I live in a place that doesnt have those problems so I cannot say whether or not it will actually work or whether its a waste of time, I am certain however that some research has been done, where is that?
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