Nancy Pelosi states that the new unemployment benefits package should be passed because unemployment benefits stimulate the economy and thus create jobs. They are in fact, according to her, one of the best job creators because the unemployment benefits are so desperately needed that they will spend the money immediately thus stimulating the economy and generating jobs. The only thing more disturbing than her own belief in this ludicrous comment is that she is only two heartbeats away from being the president.
Arthur Laffer is one of the most insightful and successful economists because his policies actually having been shown to work. True understanding of complex systems can be demonstrated in the power to predict. His predictions and rationales have demonstrated that understanding of wealth creation and economic behavior. Laffer wrote a retort to Pelosi’s Alice in Wonderland statement, without mentioning her name, likely to avoid embarrassing her with her own words, in a recent Wall Street Journal article “Unemployment Benefits Aren’t Stimulus”, explaining how paying unemployment benefits does not create jobs.
Not only is the payment itself an incentive not to work, Laffer explains, but the dollar spent by the unemployed must be paid by another taxpayer so the net incentive must total zero, not including the huge costs the government incurs to execute the transfer that someone else must also pay for. We have strayed so far from common sense that it is now considered profound just to state the obvious.
George W. Bush was deemed an idiot by his strongest critics for his lack of eloquence at the microphone. I am far more concerned with the statements from leaders that show a complete lack of understanding of the way the world works, a contempt for common sense, or a blind rejection of empirical evidence. Eloquence makes none of this more tolerable; it only makes it more disturbing.
YouTube holds political leaders more accountable that all the journalists in the field. “We have to pass this bill so we can see what’s in it, and “I have to listen to the experts so I will know whose ass to kick,” become highly viewed video symbols of our leaders’ incompetence.
I was listening to a lady on talk radio explain why it was a good idea to spend stimulus money to help the owners of convenience stores puts racks of fresh vegetables next to the Slim Jims and Yahoo chocolate drinks. It was amazing to listen to her quote the reams of data used to substantiate why this was both useful and necessary. In an age of unlimited information we apparently do not have to be restricted by common sense; we can substantiate anything.
I question whether such lunacy would have found a media outlet in the days before infinite channels. Perhaps the biggest benefit of less media was being forced to be more judicious in bringing viewpoints to the public airways, but the cost would be the risk that we may be spared the statements that show the true failings of our top leaders.
We may find comfort in illusions but if Dorothy and her posse did not pull back the curtains and expose the wizard they never would have been able to return to Kansas.