The recovery is picking up steam as employers boost payrolls, but economists think the government’s stimulus package and jobs bill had little to do with the rebound, according to a survey released Monday.
the latest quarterly survey by the National Association for Business Economics, the index that measures employment, showed job growth for the first time in two years — but a majority of respondents felt the fiscal stimulus had no impact.
NABE conducted the study by polling 68 of its members who work in economic roles at private-sector firms. About 73% of those surveyed said employment at their company is neither higher nor lower as a result of the $787 billion Recovery Act. That sentiment is shared for the recently passed $17.7 billion jobs bill that calls for tax breaks for businesses that hire, and additional infrastructure spending. More than two-thirds of those polled believe the measure won’t affect payrolls, while 30% expect it to boost hiring “moderately.”
As usual, the free market, is taking care of itself, and correcting, despite Government interference! This debate, is really about Keynesian Economics, which is the theory that the economy can be boosted if the government borrows money and then gives it to people so they will spend it. This supposedly “primes the pump” as the money circulates through the economy. Keynesian theory sounds good, and it would be nice if it made sense, but it has a rather glaring logical fallacy. It overlooks the fact that, in the real world, government can’t inject money into the economy without first taking money out of the economy. More specifically, the theory only looks at one-half of the equation — the part where government puts money in the economy’s right pocket. But where does the government get that money? It borrows it, which means it comes out of the economy’s left pocket. There is no increase in what Keynesians refer to as aggregate demand. Keynesianism doesn’t boost national income, it merely redistributes it. The pie is sliced differently, but it’s not any bigger.
The real world evidence also shows that Keynesianism does not work. Both Hoover and Roosevelt dramatically increased spending, and neither showed any aversion to running up big deficits, yet the economy was terrible all through the 1930s. Keynesian stimulus schemes also were tried by Gerald Ford and George W. Bush and had no impact on the economy. Keynesianism also failed in Japan during the 1990s.
For some reason, though, the Federal Government keeps trying it, and it just keeps on failing. The only REAL stimulus, is to allow more money to stay in the PRIVATE Sector, so that it can be spent, rather than first taking it, and filtering it through the inefficiencies of Government bureaucracies first!
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