Constable: Stimulus Not the Solution to Jobs Bust






FRIDAY’S DISAPPOINTING JOBS NUMBERS SHOULD HAVE THE WHITE HOUSE AND THE CONGRESSIONAL DEMOCRATS PANICKED. THE PROBLEM IS THAT OUR LEADERS ARE LIKELY TO DO EXACTLY THE WRONG THING TO FIX THINGS. THEY’LL PROBABLY WANT TO SPEND MORE GOVERNMENT MONEY.
THE PROBLEM EVERYONE SEES IS THAT THE 120,000 JOBS CREATED IN THE U.S. DURING MARCH IS JUST WOEFULLY INADEQUATE TO KEEP UP WITH POPULATION GROWTH, LET ALONE MAKE A DENT IN THE BACKLOG OF THE MILLIONS OF LONG TERM UNEMPLOYED.
THE SOLUTION THE GOVERNMENT OPTED FOR IN THE DEPTHS OF THE FINANCIAL CRISIS WAS MASSIVE GOVERNMENT STIMULUS AND BAILOUTS OF NEAR-DEAD COMPANIES. IT WAS AT A COST OF HUNDREDS OF BILLIONS OF DOLLARS.

BUT NEW RESEARCH SHOWS THAT THIS SORT OF MASS SPENDING DOES LITTLE TO HELP.

A PAPER PUBLISHED IN THIS MONTH FROM THE MERCATUS CENTER AT GEORGE MASON UNIVERSITY STATES:  “…the data exhibit no evidence of stimulus spending having any effect on economic growth.’

IN FACT THE AUTHORS GO EVEN FURTHER, THEY SAY THE EFFECT OF STIMULUS LOOKING OVER A VARIETY OF TIME HORIZONS IS “ALWAYS STATISTICALLY ZERO.”

OR PUT ANOTHER WAY, THAT’S HUNDREDS OF BILLIONS OF DOLLARS WASTED.

I HOPE SENSE PREVAILS ENOUGH IN CONGRESS TO KEEP THE CHECK BOOK CLOSED, BUT I FEAR NOT.

I’M SIMON CONSTABLE
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