Thursday, September 1, 2011

Government Does Not Create Value Adding Jobs

From Investors Business Daily Editorial, "Gov't Is Job Killer, Not Creator" by Benjamin Powell:
The problem is: Government doesn't create jobs that add value to the economy; companies and entrepreneurs do. Through taxes, mandates and regulation the government typically discourages hiring and destroys jobs. What Washington should do right now is step aside.
While President Obama's new proposal doesn't include digging canals with spoons, it is bound to include the economic equivalent — jobs that create work but not necessarily value.
Read the complete editorial here.


  1. "Government doesn't create jobs that add value to the economy."
    What an absurd proposition. I could think of any number of jobs that only the government will do that add jobs - either directly or indirectly - to the economy. Much of what the government does is to perform services that the market is not capable of doing, mostly in terms of guaranteeing public services to citizens, such as fighting fires, policing streets, educating all children, regulating environmental or building or workplace hazards.

    As for stimulating the economy, these expenditures - borrowed at little or no interest - immediately go out into the larger economy as government employees cash their checks and buy consumer goods from entrepreneurs. When unemployment is high, a large amount of human capital is being wasted, or distributed inefficiently as people are forced to take jobs doing work that doesn't fully exploit their knowledge base, or simply can't find work at all.

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