Many of our elected officials are convinced that only through an increase in government spending and interference in the economy can our country get back on track. In fact, President Obama recently went so far as to say in early January “There is no disagreement that we need action by our government, a recovery plan that will help jump-start our economy.”
Well, putting aside the fact that his statement is blatantly untrue, the idea that somehow more government interference will solve the problems that our economy faces now is as ignorant as it is false.
I’ve said it many times before, but I’ll say it again; the most shocking thing about history is that humans seem to simply refuse to learn from it.
What is happening in our government right now is disturbingly similar to what happened in our government in the 1930s. Presidents Hoover and Roosevelt were convinced by flawed Keynesian theories that increased government spending and public works projects were the solution to the Great Depression. History bears out that they were dead wrong.
More government spending and interference did nothing but perpetuate the problems of the Depression, extending what should’ve been a short-term market correction into a worldwide economic decline that lasted a decade.
Is this sounding familiar yet?
Our government is repeating the mistakes of the past and, through a series of bailouts and stimulus packages, simultaneously preventing the liquidation of malinvestment and bad debt, thus delaying the market correction, while also degrading the value of our dollar by over-printing money and perpetuating the market bubble by propping it up with artificially low interest rates, altogether breeding a recipe for disaster if ever there was one.
Any questions?
What our government should be doing is focusing on policies that reduce impediments to savings, investments, and production, as well as reducing the tax burden on American businesses and citizens not by printing more money, but by decreasing the size of government and cutting spending.
So in other words, if our government wants to really stimulate the economy, it should do LESS not more.
I have no doubt that many of you disagree with what I have written. Like all columnists, I am bound by the fact that there is only so much space on a page and am thus limited in the amount of detail I can go into with any one of these little rants.
However, trust me when I say that my lack of detail is not due to ignorance about my subject. I assure you that, in the spirit of a free press, I welcome any (civilized) challenge to my ideas.
So let the debate begin. Let’s get fiscal.