Wednesday, 29 October 2008

Abramson Doesn't Understand Economics Either

After learning yesterday about the Democrats plan to create a public works bill, it looks like Louisville Mayor Abramson is going to be first in line for the pork.

Abramson will speak on behalf of the U.S. Conference of Mayors before the House Transportation and Infrastructure Committee at 9:30 a.m.

The Conference of Mayors is proposing a $150 billion stimulus plan to create jobs, repair aging infrastructure and modernize schools and public housing.

"We're not looking for a bailout. We're looking for an investment," Abramson said. "Cities are the best places to invest as we can get the money out to the people and businesses that can stimulate the economy."

I love how these things are called stimulus plans. What they heck are they going to stimulate. Let me see if I understand the plan. We are going to take money from the people and businesses through taxation, and then we are going to give it to the Mayors. And they gets to dole out the money to people they believe are deserving. How will taking money from the productive private sector and giving it to the less productive public sector "stimulate" the economy? It is fundamentally impossible. I am going to have to give Abramson an F on basic economics.

This plan isn't about stimulating the economy. It is about pork. The Democrat mayors want the money so they can distribute their own pork. What better way to help supporters and stay in power than throwing a little pork their way. This stimulus plan is just another ploy by Democrats to "spread the wealth around". One small problem. It is us taxpayers whose wealth is getting spread around.
Posted by brians at 9:59 PM in Louisville Politics
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Bad Idea From the US House Majority Leader

US House Majority Leader Steny Hoyer came to Louisville yesterday to listen to ideas for public works projects.
U.S. Rep. Steny Hoyer, D-Md., the House majority leader, came to Louisville yesterday to hear local officials' suggestions on how federal economic-stimulus funds could be spent on public projects....

...Afterward, Hoyer, Abramson and Yarmuth answered questions.

America's "families, homes and communities are at risk" in the economic crisis, Hoyer said.

He noted that 750,000 people have lost jobs this year and that America needs to put people to work, and to invest in its aging infrastructure.

Congress is looking for public-works-type projects that are ready to get under way within 90 days. Hoyer said any stimulus package may include more funding for such basics as food stamps and unemployment insurance.

Ugh, that is what we need! We need "public works programs" to stimulate the economy. All of these Democrats need a basic lesson in economics. PUBLIC WORKS DO NOT STIMULATE THE ECONOMY.

Why? Because all government expenditures must be payed with taxes. Every dollar that the government spends must be raised through one dollar of taxation. That means for every dollar that they spend to stimulate the economy they will be taking a dollar from some other part of the economy through taxes. At best this is nothing but a redistribution of capital. That is at best. We are taking money from the productive private sector and feeding it to the public sector. We all know that the public sector is less efficient and less productive than their counter parts in the private sector. Which means the redistribution will result in a net negative for the economy.

So while some jobs may be "created" by the government, a greater number of jobs will be destroyed in the private sector through taxation. This is what happens when we "redistribute" capital in society. What makes this proposal even worse is that the Democrats are taking money from the hard working people of this country and giving it to the special interests that help elect Democrats. It is a direct transfer of wealth to their base supporters. We have a word for this activity. It is Marxism. I can guarantee you it will do nothing to "stimulate the economy". If anything it will hamper the natural rebound of the free market.

It is policy decision like these that make it so destructive for Democrats to have complete control over the strings of government. All they will do is tear down the natural strength of our free market economy so they can "spread the wealth around". It is ideas like these which will drastically hinder a speedy recovery from the current down turn in the economy.

Posted by brians at 12:04 AM in Political Issues
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