Americans Are Good Economists

Americans understand that federal spending policies that waste money, trickle into the economy too slowly, and lead to chronic deficits are not an effective stimulus.

Alex M. Brill
The American, A Magazine of Ideas
January 28, 2010

A year ago, Congress enacted a massive bill intended to jolt the economy out of recession. With an official ten-year price tag of $787 billion (recently revised upwards to $862 billion by the Congressional Budget Office), the White House claimed it would save or create 3.7 million jobs. Unfortunately, the reality has been quite disappointing.

As my colleague Allan Meltzer has described, the economic concept of “jobs saved” is pure foolishness. He writes, “One can search economic textbooks forever without finding a concept called ‘jobs saved.’ It doesn’t exist for good reason: How can anyone know that his or her job has been saved?”…

…Now a new poll from indicates that Americans are acutely aware of the failure of this legislation to have any meaningful impact on the economy. According to a recent CNN/Opinion Research Corporation poll, “63 percent of the public thinks that projects in the plan were included for purely political reasons and will have no economic benefit, with 36 percent saying those projects will benefit the economy.” Additionally, 74 percent of respondents believed at least half of the money had been wasted and 21 percent of respondents believed nearly all the money spent so far has been wasted. Perhaps those polled had in mind the fact that the bill spends money on such things as water pipelines for unprofitable golf courses, a program for Martha’s Vineyard residents to have their home appliances controlled from a remote location, and “socially-conscious puppet shows” in Minnesota.

And many Americans who oppose the bill didn’t come to this view after waiting and watching. According to CNN, 44 percent opposed it less than a month after it was enacted. That number has now climbed to 56 percent. And so it appears that many Americans are good economists. They understand that federal spending policies that waste money, trickle into the economy too slowly, and lead to chronic deficits are not an effective stimulus.

Unfortunately, the Obama administration and Democrats in Congress refuse to acknowledge the failure of the stimulus package and are moving full speed ahead toward passing another “jobs bill.” …

The complete article is here.

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