A Stimulating Broken Window Fallacy

Go to 3:25 and listen to President Obama speak about the benefits of  job creation for a window manufacturer in Philadelphia. (watch about 20 seconds… you’ll get the point)

Then watch this clip about the window manufacturer in Pittsburg.

Lastly, read this essay on a window manufacturer from France.  A lot of lessons to be learned…

Birds still fly

Here is a letter I recently sent to the Midland Daily News:

In his recent letter, Scott Miller states, “it appears that some of our legislators are more concerned with profits for big business than the health and future welfare of their constituents.  Contact senators Stabenow and Levin and urge them to come together around a bipartisan effort to develop affordable clean energy and climate legislation…” (“Go Green,” Jan. 21).

In one breath, Scott acknowledges that politicians are concerned with pleasing special interests.  In his next breath, however, he urges his readers to contact the very class of people he decries in order to create a solution.

I’m puzzled.  Is Scott unaware that several large businesses are currently lobbying for clean energy legislation?  These large businesses will profit from new regulations that crush their smaller competitors.  Once clean energy legislation is passed into law, it would also not be surprising to find that these same large businesses are recipients of special government permits that exempt them from such regulations. 

I admire those who seek to reduce pollution.  I am saddened by those who are blind to the colossal gap between desired outcomes and the actual outcomes generated by government intervention.  Once this gap is recognized, it will become painfully obvious that desirable outcomes will not emerge from encouraging fellow citizens to jump into the slopping pit.

Kurt Bouwhuis

A Political Romance

Here is a letter I recently sent to the Midland Daily News:

Imagine the excitement of wealthy health industry executives as they watch the progression of the healthcare bill through the political system. These executives have been paying lobbyists large sums of money in an attempt to pass healthcare reform and it’s all about to pay off. If the bill passes, it will require every single American to have health insurance resulting in a large increase in the demand for their health services.

An even larger increase in demand will result from a lack of rationing from the consumers. Under healthcare reform, consumers will have access to as many healthcare services as they can get their hands on at no additional costs to themselves. To top it off, a credible third party with deep pockets (government) will pick up the tab for all additional expenses. In short, health reform will offer guaranteed payments and increased revenues to already wealthy individuals working within the healthcare industry.

Some may read the paragraphs above and say that I have it all wrong; healthcare is a human right and the reform is all about helping those who are not fortunate enough to provide for themselves. If this is the thought passing through your mind, you are likely an extremely kind hearted individual who is unknowingly endorsing the plans of special interests. In order to understand why this is true, it is important to be able to distinguish between the actual political process and the theatrical performances that follow.

The actual political process goes something like this – Special interests have a strong desire to extract money from the public purse. Unfortunately, extracting money from the public purse is a tricky process – No one ever approaches the government and says “I need $1 million dollars because I’m a good person and I deserve it.” Besides, special interests are much too sophisticated for such a request. Instead, they pay lobbyists and politicians (through campaign contributions) to ask for the same thing in a slightly different way. As soon as the payments have been made, the theatrical performances ensue. All of a sudden, lobbyists and politicians are saying “We need to pass bill X to protect the middle class.” What remains unmentioned is the $1 million that ends up in the pockets of special interests as a result of bill X.

The benefits of bill X are then mentioned in the media which excites regular citizens, causing a few of them to become activists. These activists are generally the kind hearted individuals mentioned earlier who unknowingly become the frontmen for special interests. The activists then go out on the streets and inform other people of the bill’s merits. Once the bill passes into law, the special interests pocket a portion of the loot for themselves and distribute the remainder to the political party and politicians who helped pass the bill. When another opportunity presents itself, a portion of the loot is spent to hire more lobbyists to begin yet another cycle.

This cycle will continue until the public at large stops romanticizing over the theatrical performances of politicians and realize what actually happens within the political system. With this knowledge, the endorsement of healthcare reform by several prominent politicians will be “no more surprising than that a hog would gorge itself when presented with a trough of food and be about as appetizing to watch.”*

Kurt Bouwhuis

*Andrew P. Morriss, Letter to the Financial Times, Oct. 14, 2008.

Prosperity or Plunder?

Here is a letter I recently sent to the Lansing State Journal:

In a recent editorial, The Lansing State Journal states that the stimulus money is key to the long term recovery of the mid-Michigan economy (“Stimulus funds matter to mid-Michigan,” Nov. 20).

Nonsense.

The majority of the stimulus has been funded through borrowed money.  Every time the government borrows a dollar, there is one less dollar available for the private sector to borrow.  Since the private sector relies on borrowed money for expansion, the stimulus has essentially deprived several businesses of opportunities that would have been viable had the credit been available.

Additionally, forcibly obligating American taxpayers to billions of dollars of debt is no path to long term economic growth.  Especially when a large portion of the borrowed dollars are being shoveled into the bank accounts of special interests who have effectively used government to garner additional revenues at the taxpayer’s expense.

Kurt Bouwhuis

Politics and Theatre

Here is a letter I recently sent to the Midland Daily News:

John Burke writes in his recent letter that: “[U.S. Rep. Bart Stupak should] also remember that health care reform is a moral issue in itself. That thousands are dying every year because of the lack of affordable health care is also a call to provide help “to the least of these” (Matt 25:40)” (“Stupak Admired,” Nov 18).

I agree 100% that thousands of people dying every year due to lack of health care is awful.  Unfortunately, it does not logically follow that government is the most effective tool for alleviating this problem.  Even if it were possible to accurately communicate the desires of the public to congress, it is highly unlikely that congress would fulfill the desires of the public over the desires of special interest groups. 

The current health care proposals are no exception.  Although health care reform has been sold to the public as a solution to the suffering illustrated above, behind the scenes, it is nothing more than a power grab by big businesses that have effectively used special interest groups to rig government policy in their own favor at the expense of American consumers.

Kurt Bouwhuis