Don’t Feed the Animals

republican_logoKurt Bouwhuis, Mackinac Center Intern

“You actually have a consensus among conservative, Republican-leaning economists and liberal, left-leaning economists. And the consensus is this: that we have to do whatever it takes to get this economy moving again, that we’re going to have to spend money now to stimulate the economy,” Obama said on the program, which aired Sunday.

I hope “whatever it takes” does not include creating money out of thin air and distributing it to individuals and businesses at arbitrary quantities that bureaucrats sees fit.  I also hope Obama and his board of economists understand that you do not grow an economy with spending, but rather, investment.  You will see short run benefits from spending, but you will see stable long term growth with investment.  This is assuming there are no entities messing around with the interest rates (Fed), sending inaccurate market signals to capitalists and entrepreneurs, causing an inefficient allocation of resources.

donkey-democrat-logo1Sounds to me as though this “market crisis” will convey enough insecurity to pave the way for the unveiling of a new New Deal.  Together, these two parties will lead us down a path where we will continue to live way beyond our means through the creation of numerous short run solutions. If we truly want to “fix” the economy, we may want to look at what makes an economy prosper.  I would argue prosperity comes from allowing an economy to create goods and services that are demanded by consumers around the globe at a profitable price.  If your economy is creating goods and services that people want, your economy will prosper.  Aiding the economy has nothing to do with printing money, or stimulus checks, or public health care, or tampering with the interest rates, or subsidizing, or regulating…  An economy will prosper when it is allowed to produce.


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