by the Left Coast Rebel
I typically loathe elitist (wannabe conservative) New York Times columnist David Brooks. Today he got something right and nails a central point about deficit spending, especially in a recession:
If the economists are divided about what just happened, the rest of the world is not divided about what should come next. Voters, business leaders and political leaders do not seem to think that the stimulus was such a smashing success that we should do it again, even with today’s high unemployment.Read the rest here, also at Memeorandum.
They seem to see the fiscal floodgates wide open and that the private sector still only created a measly 41,000 jobs last month. That doesn’t inspire confidence. Furthermore, they understand something that is hard to quantify: Deficit spending in the middle of a debt crisis has different psychological effects than deficit spending at other times.
In times like these, deficit spending to pump up the economy doesn’t make consumers feel more confident; it makes them feel more insecure because they see a political system out of control. Deficit spending doesn’t induce small businesspeople to hire and expand. It scares them because they conclude the growth isn’t real and they know big tax increases are on the horizon. It doesn’t make political leaders feel better either. Lacking faith that they can wisely cut the debt in some magically virtuous future, they see their nations careening to fiscal ruin.
And yet the professorial progressive-statist leadership today is too stupid to understand the above example in bold. Essentially that is what the Tea Party movement is all about - a government that has grown to be big enough that it can take it all away. Massive trillion dollar 'stimulus' bills that are grab-bag giveaways that future generations will pay for, endless bailouts and crippling debt.
It is no wonder that Washington is crushing main street business morale.
Also, I must point you to an excellent post at the new site Allied Liberty News. KOOK (formerly of KOOK's Manifesto) put the brand new site together recently and started off by a main street economic piece about progressive-statist economics and a local pizza shop run by a hardworking couple.
If every indocrinated college student could see the truth to the example of the pizza shop business, their eyes would be open to a completely different world of economics. Read it here.