I was just pondering huge government stimulus packages while hanging up laundry to help cut my gas bill.
I don't think a stimulus package will work. Once that new bridge is built, the road paved and the workers head home. What happens next?
There will be great pressure on government types; taxpayer supported civil and teacher unions as this thing progresses to take the cuts that that have occurred in the rest of the labor force that supports them. All which leads to less spending and less potential for economic recovery.
Things started going wrong in about 1914 when we went off the gold standard and started printing money. Now $1 is worth about 3 cents.
We traded, outsourced, "stayed the course", and deceived ourselves into a standard of living that wasn't sustainable. And then the world caught up with the plan offering continuously merging companies a huge labor pool working for pennies an hour.
The "free market" is a loosing proposition unless you are the person (the country) where the capital is flowing. China has the upper hand at the moment rolling in a 9% growth, while we wring our hands, throwing taxpayer money at the problem in the last hour and perpetuate ideas already not working.
Leave a comment