[quote]Iron Dwarf wrote:
[quote]orion wrote:
[quote]OctoberGirl wrote:
[quote]orion wrote:
[quote]OctoberGirl wrote:
Exactly! Those people put in their time and effort, got paid and restored their pride.
[/quote]
Better[/quote]
haha! Perhaps brevity is better.
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Without wanting to drag this into PWI, my point was that government programms are unable to stimulate the economy, because the money is redirected from the private sector.
Since we know that the projects governments sponsor are not the peoples first choice because if they were whatever project the government undertakes would already have been built by the private market, make work programms necessarily reduce overall utility, or more precise, furure overall utility is lower than it would have been.
Flows logicaly from the idea of utility.
And that is before the waste and corruption that inevitably occur when people woek with other peoples money and have no stake whatsoever in the economic outcome.
So, if you want to sell it as some kind of work therapy, fine, but helping the economy it most decidedly did not.
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What stimulates an economy? BUYING STUFF. Can you buy stuff without a job? No. The best way to stimulate an economy is to give the public buying power. A JOB is the best way to achieve that. [/quote]
To make it simple, government projects make people buy less stuff or at least stuff they want less or otherwise they would already have bought them.
Since the government project is not what they really want, the projects must either kept running indefinitely or the whole supporting industry crashes and the economy must readjust itself to real consumer demand.
So, first inefficient use of resources, then destruction of misallocated resources that were used to misallocate resources.
A one two punch if you will.
Senseless, but politically savvy because people can always look at a dam or a railroad and see that its there, what they do not see however are all the small and middle sized businesses that never came into existence because said dam was built and they would have produced what the people really wanted and where actually willing to spend their own money on.