American Elephants


The Tea Party Understands That Government Can’t Create Jobs. by The Elephant's Child

From the Heritage Foundation’s blog The Foundry this morning:

In the 1993 comedy Dave, a small-town presidential impersonator is called on to pretend to be the actual President of the United States when the commander-in-chief takes ill. Dave steps into the White House, takes his new role too far, and with wide-eyed innocence promises America, “I’m initiating a program to try to find a decent job for every American who wants one.” Yesterday in Holland, Michigan, President Barack Obama made a strikingly similar pledge:

“Over the coming weeks, I’m going to be putting out more proposals, week by week, that will help businesses hire and put people back to work. And I’m going to keep at it until every single American who wants a job can find one.”

It’s anyone’s guess if President Obama was taking a page from Dave’s playbook, hoping that the magic of Hollywood or the power of a populist message would resonate with Americans, helping to turn around his plummeting poll numbers. But a few things were clear in the President’s speech: Despite all evidence to the contrary, he is still clinging to the notion that the federal government can create jobs, he remains utterly disconnected from the reality that the American people are fundamentally dissatisfied with the direction he is taking the country, and he is doggedly sticking to his favorite script—the story of more federal spending coming to America’s rescue.

Paul Roderick Gregory explains in a column at Forbes:

The appeal of Keynesian economics is its simple logic.  If government spending for goods and services is part of GDP, then any increase in government spending must raise GDP.

As President Obama explained in a town hall meeting on Feb. 8, 2009: “Republicans say this is not a stimulus bill but a spending bill.  What do you think a stimulus is? That’s the whole point.”

Keynesian economics is easy, even for stupid people. More thought and analysis are required to understand why it has not worked as it is supposed to. Keynesian skeptics must show that increases in government spending cause other components of GDP, such as consumption, investment, or exports, to fall. Such countervailing forces require more nuanced and sophisticated thought. They are not for the mentally lazy or those seeking simple answers.

Liberals, he goes on to say, target the Tea Party as stupid.  They are not only dumb, but they don’t care if they bring down the country as well.

The Tea Party people are in rather distinguished company.  Since the Nobel Prize in economics was established, seven Nobel Prizes have been awarded to economists who cast serious doubt on Keynesian economics.

Consumers are not affected by transitory changes in income.  A permanent tax cut or increase will affect consumer spending, but a temporary change will not.   Contrary to liberal thinking, people are not stupid with respect to government taxes and government spending.  They are forward-looking, and try to prepare for the future.  Businesses and households are hunkering down.

The Obama administration has encouraged this by constant talk of new taxes. And in the face of the current downgrade in our credit rating, disastrous levels of debt, President Obama is attempting to embark on a new stimulus.  Keynesian economics and truthiness: the quality of preferring concepts or facts one wishes to be true, rather than concepts or facts known to be true. Gregory adds:

Perhaps the president simply does not want to hear from those who disagree with the course he has chosen. It could be that the president’s goal is not recovery and economic growth but growing the size and scope of government to achieve his goal of a redistributive state.

If that is the case, we are in for trouble.


7 Comments so far
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What really bothers me is stupid, jingoistic statements like, “there is not a single country on Earth that wouldn’t trade places with us. Not one.”

Did Obama take a pole of national leaders? Has he actually made that offer (to trade places) and gotten a wave of affirmative responses? Did Sweden, for example, say. “Yup, when do we effect the move?” Did Australia start calling the relocation services?

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Comment by Subsidy Eye

Johnson Controls is a corporate welfare queen.

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Comment by Subsidy Eye

And I should have written “poll”.

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Comment by Subsidy Eye

I can’t help but be reminded when I first ran for student council in elementary school. I promised the students “I will fight to make sure school lunch offers ice cream for desert every day” It is that childish sounding isn’t it?

The class warfare talking points are getting worse also. I just don’t understand how some voters can’t see the demagoguery for what it is. He must be intentionally trying to whip up riots as they become more and more common, like in London and WI. Otherwise how can he justify all his precious air time spent on raising taxes on corporate jet loopholes? First: He must know they don’t add up to all that much. Second: He was the one who gave those loopholes with the stimulus in an effort to entice the rich to spend more money. Too bad private jets aren’t outfitted in the US anymore. The ‘luxury’ tax has pushed that industry oversea’s just like building expensive boats. Just ask Senator Kerry. Another poorly thought out stimulus to help foreign companies like ‘cash for clunkers’. Germany had a similar stimulus but they were smart enough to add language that required them to buy German made cars with it.

The unemployment insurance extension [extortion] card is being played again too. Seems like they make Republicans look like Mr. Scrooge every 6 months with this propaganda, no thanks to our MSM’s liberal collusion on this thread. They are saying that these handouts created 1million jobs now? http://t.co/DUZ087n Do they count these as jobs ‘saved or created’ since he became President? No wonder they keep bragging about how well the economy is doing with statistics like this. Carney sounds more and more like ‘Baghdad Bob’ these days. If Obama ever throws him under the bus, I bet Qaddafi or Chavez would hire him in a heartbeat for their state run media shows. NO, taking money from hard working Americans to give to the chronically unemployed doesn’t help our economy, GDP, or create jobs! If anything it just disenfranchises those on the edge who could live better off the government dole. This is insanity! If this *were* true nobody would have to work, we could just keep giving everybody unemployment checks and our country would just keep chugging along like the Soviets or Cuba…

Oh, that must be it… Reminds me of the conditions before just about every communist revolution throughout recent history. Class warfare, everybody dependent on Government for food, shelter, healthcare, money, etc. (cradle to grave entitlements as a constitutional right) All they need now is a big riot to justify taking our guns away and we will be peasants under a Tyrant. Too bad he wasn’t able to frame those nasty gun dealers in AZ for selling to Drug Cartels… Almost had us… He still has 1.5 years to finish; Look out!

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Comment by Jimmy D (@jimfact)

Exactly. The battle is in trying to inform people who don’t pay much attention to the news, and are thus susceptible to sound bites. Instead of classes in social justice and civil rights, in the “information age” we need classes in how to sort the information, validate sources, and recognize what is good information and what isn’t. But then ideas like “right” and “wrong” aren’t cool, are they.

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Comment by The Elephant's Child

@AE

I like how you framed this demographic in your comment. Unlike leftist leaders who just paint half of America (flyover) as ignorant or bigoted… You categorize them as those that choose not to “pay much attention to the news.” eg: Somebody may struggle at math but it isn’t because they are stupid… Rather they may be more interested in the Arts or something else. If they received the same enjoyment out of reading history as I; they could become just as good as I in it.

Well played AE 🙂 I always struggle trying to debate people w/o coming off as elitist (*think John Murtha) when I ‘knee jerk’ refer to them as the ‘ignorant mob’ or something. LOL, PR 101 thank you, I will remember it. As you state we must work to enlighten/convert as many as we can, but I often offend them too quickly and they shake the lure before I can plant the seed that liberty and personal responsibility are a requirement for humans. As our nature leads us to do as little as possible to get by w/o our parents conditioning us how to live a fulfilling life through hard work and sense of accomplishment.

RE: Enjoying being ‘Right or Wrong’ requires a competitive nature… Just like some not being interested in news, we can find an equal number turned off by competition. They usually settle for a union/govt job and are quite satisfied with it… They are also almost always leftists.

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Comment by Jimmy D (@jimfact)

Another poorly thought out stimulus to help foreign companies like ‘cash for clunkers’. Germany had a similar stimulus but they were smart enough to add language that required them to buy German made cars with it.

Evidence, please? Had Germany done that, they would have immediately been determined to have been in violation of European Commission single-market rules. Indeed, as this article from Der Spiegel explains:

[M]uch of the money — 75 percent, according to the Halle study — will go to people who would have bought cars anyway. And a large chunk of German taxpayer dollars will flow to manufacturers outside the country. While Ford makes the Fiesta in Cologne, the Ka comes from a factory in Poland. Fiat, Renault, and other non-German carmakers are among the main beneficiaries of the rebate.

Had the United States cash for clunkers program contained language restricting the payments to U.S. manufactured cars, it could have been challenged by other WTO member economies as in violation of the Agreement on Subsidies and Countervailing Measures.

Your comment provides evidence that free-trade economists are right to ring alarm bells about rising protectionism in the world. If even Republicans are calling for such protectionist policies as tying cash for clunkers to the purchase of a domestically manufactured car, then there is little hope for getting the rest of the population to support free and open intrernational trade.

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Comment by Subsidy Eye




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