"Lenin is said to have declared that the best way to destroy the Capitalist System was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens....Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose." ~ John Maynard Keynes
Scaring Away the Alligators
Column by Duane Colyar.
Exclusive to STR
Economic stimulus programs, which are akin to taking money out of the economy with one hand and putting it back into the economy with the other, work wonderfully--for politicians, that is. Taxpayer money can be channeled to buy the support of politically connected industries and groups. Accordingly, one can assume that politicians embrace the questionable Keynesian theory of "pump priming" to jump-start a stalled economy, as opposed to other economic theories, precisely because the Keynesian model expands government power and allows favored groups to be paid off in exchange for political support.
Government cannot create wealth; government can only transfer wealth from those who produce it to those who don’t. Likewise, government cannot create jobs; government can only transfer jobs from satisfying consumer demand to satisfying the need for political pork. It doesn’t take a degree in economics for most people to understand that for every job created by taxpayer money, another job is lost or not created in the private sector.
However, the administration and its camp followers, to include Keynesians, are touting the benefits of the stimulus programs initiated by the federal government to recharge the ailing economy. They would like us to believe that the economy would be in even worse shape had this stimulus and bailout money not been provided. They argue that unemployment would be higher and the Misery Index would be at the top of the scale. No proof for this argument is offered because, of course, there can be no verifiable proof for an alternative universe of what might have been.
Their arguments remind me of a conversation I had with a friend many years ago. We arrived at her house during the evening and I heard her dog barking by a creek in a field behind her home. “Why is your dog barking,” I asked. “He’s scaring away the alligators,” she matter-of-factly responded. I reminded her that there were no alligators in our part of the country. “He’s doing a good job,” she replied with a straight face.
The President, Federal Reserve Chair and Congress Critters would have us believe the obvious incongruity that rampant deficit spending is saving the economy, which would otherwise collapse without their skilled fiscal and monetary oversight and guidance. They don’t want us to forget the dire consequences that allegedly might have happened and still could happen if we become too fiscally conservative.
How can we, the great unwashed, be so ungrateful as to doubt the credibility, wisdom and insight of our elite leaders? In the meantime, I’ll continue to hang garlic to keep away the vampires at night (it’s doing a good job) and rummage through my kitchen cabinet to find my grandmother’s old bloodletting cup so I may ward off the bad humors I feel coming on.