"There are men, in all ages, who mean to exercise power usefully; but who mean to exercise it. They mean to govern well; but they mean to govern. They promise to be kind masters; but they mean to be masters." Daniel Webster

Sunday, January 11, 2009

What's Wrong with "Stimulus"?

Economist Frank Shostak writes

Any activity that the government would initiate requires funding. (Various individuals who will be employed by the government will expect compensation for their work.) The government as such doesn't create any real wealth, so the only way it can pay these individuals is by taxing others who are still generating real wealth. By doing this, the government weakens the wealth-generating process and undermines prospects for economic recovery.

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