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Jewish World Review Feb. 4, 2009 / 10 Shevat 5769 We can't spend our way to prosperity By John Stossel http://www.JewishWorldReview.com | Washington never changes, no matter who's in power. Give a gang of politicians a chance to spend our money, and they will spend it — the more the better. An economic downturn is hog heaven; for now they have a justification to spend big time: "economic stimulus." Anything and everything can be proposed as long as it can be said to "inject money into the economy" and "create jobs." Does $819 billion sound like too much? Au contraire. It may not be enough. Ask Paul Krugman and the other Keynesians. The danger, they say, lies in spending too little. Not to worry. The Senate will probably throw in more money. And the Obama administration says this is just the beginning. "While many of the projects are a down payment on long-term goals, including energy policy reform, health-care reform and the expansion of infrastructure investment, the goal has never been to accomplish every legislative goal in one fell swoop," White House spokeswoman Jen Psaki said (http://tinyurl.com/anrqht). House Speaker Nancy Pelosi thinks that hundreds of millions of dollars for family-planning services will stimulate the economy. My colleague George Stephanopoulos of "This Week" was incredulous. But Pelosi was ready for him: "Well, the family planning services reduce cost. ... The states are in terrible fiscal budget crises now. ... [C]ontraception will reduce costs to the states and to the federal government". Fortunately, the White House saw that as a stretch and distanced itself from Pelosi. "The principles of what he [President Obama] thought should be in the package — that wasn't part of that," said Deputy Press Secretary Bill Burton. That glitch aside, an agreement has emerged on how Congress should "stimulate the economy." The final bill will contain spending on states and localities, roads and bridges, unemployment benefits, "green" technologies, etc. President Obama has vowed that no earmarks — special appropriations to benefit particular congressmen — will sully the final package. But in the Wonderland called Washington, things are never what they seem: "The result, as The Associated Press learned in interviews with more than a dozen lawmakers, lobbyists and state and local officials, is a shadowy lobbying effort that may make it difficult to discern how hundreds of billions in federal money will be parceled out". What a surprise. Even if the spending could give the economy a jolt, at what price? I don't mean the legislation's overt price tag. I mean the production lost because the money borrowed by the government won't be available for private investment aimed at satisfying consumers. Do we want politicians directing how scarce resources are used? I'd rather have those decisions made by entrepreneurs who must please consumers or go bankrupt. It's perfectly clear that the recession is a license for politicians to do what they've wanted to do all along. All the usual checks on extravagance, weak as they are, have been washed away. Budgets? We'll worry about that later. Inflation? We'll worry about that later. After all, Keynes said: "In the long run we are all dead". Keynes, at any rate, is dead, but we're stuck with his legacy of profligate, burdensome government. And now we are about to stick our children and grandchildren with even more — intrusive government, more debt, higher taxes and price inflation. We should be suspicious when politicians, economists and the media declare a "consensus" and marginalize dissent. President Obama says, "There is no disagreement that we need action by our government, a recovery plan that will help to jumpstart the economy." That's not true. Last week, the Cato Institute ran a full-page newspaper ad signed by more than 200 economists, including Nobel laureates stating: "We the undersigned do not believe that more government spending is a way to improve economic performance. More government spending by Hoover and Roosevelt did not pull the United States economy out of the Great Depression in the 1930s. More government spending did not solve Japan's 'lost decade' in the 1990s ... Lower tax rates and a reduction in the burden of government are the best ways of using fiscal policy to boost growth." Let's hear no more about "everyone" agreeing that politicians can spend the economy into recovery. Archives Every weekday JewishWorldReview.com publishes what many in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here. JUST OUT FROM STOSSEL Myths, Lies and Downright Stupidity: Get Out the Shovel --- Why Everything You Know Is Wrong   Stossel mines his 20/20 segments for often engaging challenges to conventional wisdom, presenting a series of "myths" and then deploying an investigative journalism shovel to unearth "truth." This results in snappy debunkings of alarmism, witch-hunts, satanic ritual abuse prosecutions and marketing hokum like the irradiated-foods panic, homeopathic medicine and the notion that bottled water beats tap. Stossel's libertarian convictions make him particularly fond of exposes of government waste and regulatory fiascoes. Sales help fund JWR. JWR contributor John Stossel is co-anchor of ABC News' "20/20." To comment, please click here. © 2009, by JFS Productions, Inc. Distributed by Creators Syndicate, Inc.

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