Thomas Woods Explains It All

To coincide with the release of his new book, the prolific Thomas Woods, one of my favorite writers, has an article in Human Events:

According to Bob Higgs we may as well call the so-called stimulus bill “swimming-pool economics.” It’s based on the idea that if you take water from the deep end and pour it into the shallow end, the water level will rise.

Over the next few years, the February 4 report of the Congressional Budget Office (CBO) assures us, the stimulus is all sunshine and lollipops. The CBO concedes that by 2019 the stimulus will have depressed GDP by somewhere between 0.1 and 0.3 percent, but almost no Washington politician has a time horizon that long. (And even if those arbitrary figures were correct, they reflect only the palest shadow of the real consequences of the stimulus, as I explain in my new book Meltdown.)

The Keynesian idea behind the so-called stimulus is that prosperity can be restored if the government is allowed to seize enough resources from the private sector and spend them on just about anything.

Well, to be fair, not quite anything: according to Section 1109 of the bill, “None of the funds appropriated or otherwise made available in this Act may be used for any casino or other gaming establishment, aquarium, zoo, golf course, or swimming pool.”

The CBO provides us with the usual arbitrary estimates of the number of jobs the stimulus will create: between 1.3 million and 3.9 million. Wherever they pulled those figures from (and I have my suspicions), what kind of jobs are these? Are they jobs the economy would have produced in response to genuine consumer demand, or are they jobs the economy would have to be, um, “stimulated” into creating? If “creating jobs” is all we want, we should hand out teaspoons and tell people to start digging trenches. Government, since it acts in isolation from the market, can’t possibly know what kind of jobs actually yield value rather than simply squandering resources and wealth.

Section 3(a)(4) of the stimulus bill describes one of its goals as stabilizing “state and local government budgets, in order to minimize and avoid reductions in essential services and counterproductive state and local tax increases.” Isn’t that nice? Instead of having to raise taxes or (perish the thought!) cut spending, the states can simply get free money! Why didn’t we think of this before?

Now if you’re a saboteur who hates America, which is how President Obama characterizes critics of the stimulus, you might be inclined to ask where the tooth fairy is getting the money she’s giving to the states.

(read on)

Also, Young Americans for Liberty has launched a campaign to help get Woods on TV so that more people can be exposed to real cause of our current economic mess. Join up here.

[Incidentally, this will be the second book titled Meltdown that I'll be reading. Patrick Michael's book on the distortions and lies that surround global warming alarmism is also worth a read.]

One Response to “Thomas Woods Explains It All”

  1. Robert R Says:

    Yeah, I agree that this bill is not going to fix the problem. Too much is being given to the same system that caused this mess in the first place. All that money could have paid off all foreclosures, yet instead it is going to the banks who want to keep us in perpetual debt. We are being mugged of our jobs and the value of our money. Mr. Paul, you would like this article. The website seems to speak of an objective viewpoint just like you do… no BS, hehe:

    Dazed and Confused: That’s Because you’re Being Mugged

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