Saturday, July 17, 2010

Economics vs. Politics

In Applied Economics: Thinking Beyond Stage One, Thomas Sowell illustrates the major difference between economic and political mindsets:
"Politics offers attractive solutions, but economics can offer only tradeoffs. For example, when laws are proposed to restrict the height of apartment buildings in a community, politics presents the issue in terms of whether we prefer tall buildings or buildings of more modest height in our town; economics asks what you are prepared to trade off in order to keep the height of buildings below some specified level. In places where land costs can equal or exceed the cost of the apartment buildings themselves, the difference between allowing ten-story buildings to be built and allowing a maximum of five stories may be that rents will be much higher in the shorter buildings, because land costs are now twice as high per apartment.

"Nor are money costs the only costs. With twice as many shorter buildings now required to house the same number of people, the community must spread outward since it cannot spread upward, and that means more commuting and more highway fatalities. The question then is not simply whether you prefer shorter buildings, but how much do you prefer shorter buildings, and what price are you prepared to pay to mandate height restrictions in your community. A doubling of rents and three additional highway fatalities per year? A tripling of rents and ten additional highway fatalities per year? Economics cannot answer such questions — it can only make you aware of a need to ask them.

"Economics was christened 'the dismal science' because it dealt with inescapable constraints and painful tradeoffs instead of more pleasant, unbounded visions and their accompanying inspiring rhetoric, which many find so attractive in politics and in the media. Moreover, economics follows the unfolding consequences of decisions over time, not just what happens in stage one, which may indeed seem to fulfill the hopes that inspired these decisions. Nowhere are the consequences more long-lasting than in housing, where a community can have an aging and shrinking supply of apartment buildings with accompanying housing shortages for decades, or even generations, after passing rent control laws which have a track record of leading to such consequences in countries around the world.

"The passage of time insulates many political decisions from public awareness of their real consequences. Only a small fraction of New Yorkers today are old enough to remember what the housing situation was there before rent control laws were introduced during World War II. Only a dwindling number of Californians are old enough to remember when that state's housing prices were very much like housing prices in the rest of the country, instead of being some multiple of what people pay elsewhere for a home or an apartment. These and other consequences of particular political decisions in the past are today just facts of life that new generations have grown up with as something as natural as the weather or other circumstances of their existence which are beyond their control.

"The vast numbers of frustrated California motorists who endure long commutes to and from work on congested highways are unlikely to see any connection between their daily frustrations and attractive-sounding policies about 'open space' or 'farmland preservation.' Nor are economists who point out that connection likely to be as popular with them as politicians, who are ready to offer solutions to rescue these motorists from their current problems using the same kind of one-stage thinking that created those problems in the first place."1
1. Thomas Sowell. Applied Economics: Thinking Beyond Stage One.

Tuesday, June 29, 2010

Heeding Hazlitt

David Axelrod, Senior Advisor to President Obama, recently advocated the Stimulus Bill (the American Recovery and Reinvestment Act of 2009):
"This summer will be the most active Recovery Act season yet, with thousands of highly-visible road, bridge, water and other infrastructure projects breaking ground across the country, giving the American people a first-hand look at the Recovery Act in their own backyards and making it crystal clear what the cost would have been of doing nothing...The Recovery Act is putting millions of Americans to work and helping the economy grow again."
Axelrod is correct in saying that the bill's spending provides employment and improves infrastructure. However, further analysis calls into question whether such spending actually helps the economy grow.

Distinguished economist Henry Hazlitt provides such analysis in his compelling book, Economics in One Lesson:1
"A certain amount of public spending is necessary to perform essential government functions. A certain amount of public works—of streets and roads and bridges and tunnels, of armories and navy yards, of buildings to house legislatures, police and fire departments—is necessary to supply essential public services. With such public works, necessary for their own sake, and defended on that ground alone, I am not here concerned. I am here concerned with public works considered as a means of 'providing employment' or of adding wealth to the community that it would not otherwise have had.

"A bridge is built. If it is built to meet an insistent public demand, if it solves a traffic problem or a transportation problem otherwise insoluble, if, in short, it is even more necessary than the things for which the taxpayers would have spent their money if it had not been taxed away from them, there can be no objection. But a bridge built primarily 'to provide employment' is a different kind of bridge. When providing employment becomes the end, need becomes a subordinate consideration. 'Projects' have to be invented. Instead of thinking only where bridges must be built, the government spenders begin to ask themselves where bridges can be built. Can they think of plausible reasons why an additional bridge should connect Easton and Weston? It soon becomes absolutely essential. Those who doubt the necessity are dismissed as obstructionists and reactionaries.

"Two arguments are put forward for the bridge, one of which is mainly heard before it is built, the other of which is mainly heard after it has been completed. The first argument is that it will provide employment. It will provide, say, 500 jobs for a year. The implication is that these are jobs that would not otherwise have come into existence.

"This is what is immediately seen. But if we have trained ourselves to look beyond immediate to secondary consequences, and beyond those who are directly benefited by a government project to others who are indirectly affected, a different picture presents itself. It is true that a particular group of bridgeworkers may receive more employment than otherwise. But the bridge has to be paid for out of taxes. For every dollar that is spent on the bridge a dollar will be taken away from taxpayers. If the bridge costs $1,000,000 the taxpayers will lose $1,000,000. They will have that much taken away from them which they would otherwise have spent on the things they needed most.

"Therefore for every public job created by the bridge project a private job has been destroyed somewhere else. We can see the men employed on the bridge. We can watch them at work. The employment argument of the government spenders becomes vivid, and probably for most people convincing. But there are other things that we do not see, because, alas, they have never been permitted to come into existence. They are the jobs destroyed by the $1,000,000 taken from the taxpayers. All that has happened, at best, is that there has been a diversion of jobs because of the project. More bridge builders; fewer automobile workers, radio technicians, clothing workers, farmers.

"But then we come to the second argument. The bridge exists. It is, let us suppose, a beautiful and not an ugly bridge. It has come into being through the magic of government spending. Where would it have been if the obstructionists and the reactionaries had had their way? There would have been no bridge. The country would have been just that much poorer.

"Here again the government spenders have the better of the argument with all those who cannot see beyond the immediate range of their physical eyes. They can see the bridge. But if they have taught themselves to look for indirect as well as direct consequences they can once more see in the eye of imagination the possibilities that have never been allowed to come into existence. They can see the unbuilt homes, the unmade cars and radios, the unmade dresses and coats, perhaps the unsold and ungrown foodstuffs. To see these uncreated things requires a kind of imagination that not many people have. We can think of these non-existent objects once, perhaps, but we cannot keep them before our minds as we can the bridge that we pass every working day. What has happened is merely that one thing has been created instead of others."2
1. It's amazing that a book written 60 years ago directly addresses what Axelrod said just last week.
2. Henry Hazlitt. Economics in One Lesson: The Shortest and Surest Way to Understand Basic Economics, pg. 19-21.

Monday, June 14, 2010

Freedom and Happiness

I had a great day at work the other day. After hours of trying to figure out why the software I'd written wasn't working, I finally found the error in my code that was causing the problem. As a software engineer, one of the most rewarding parts of my job is successfully debugging code — finding and fixing my own mistakes. It's strange that part of my happiness requires that I make mistakes, because those same mistakes can cause frustration and delay! It's sometimes hard to understand what makes us happy.

This got me thinking about a friend of mine who moved from beautiful Palo Alto, California to blustery Chicago. I remember asking him why he'd want to leave such a great climate for cold and windy weather, and he told me that he'd become bored of the perfect weather and that he missed the rain and the cold. It struck me as odd that even though my friend would probably prefer nice weather on any given day, he was happiest when he experienced subpar weather some of the time.

The recipe for happiness can be puzzling, and it changes from person to person and from time to time. The inconsistent and unpredictable nature of happiness underscores the importance of giving individuals the freedom to find and bring about their own happiness, and makes me wary of any mandatory government program that is claimed to make life better for all people.

Take Social Security, the social insurance program that is funded by mandatory payroll taxes. Before Social Security was signed into law, President Franklin D. Roosevelt said, "There is no reason why everyone in the United States should not be covered. I see no reason why every child, from the day he is born, shouldn't be a member of the social security system." So FDR couldn't see any reason why people shouldn't have Social Security? Well what about if they don't want to? What if they want to spend their hard-earned money on something else? And who is anyone to say what should or shouldn't be a part of everyone else's life?

I think it's arrogant for anyone, even the President, to presume that any one thing will make life better for everybody. And while financial security can greatly improve a person's quality of life, government-imposed financial security undermines our freedom. As Benjamin Franklin put it, "They who can give up essential liberty to obtain a little temporary safety, deserve neither liberty nor safety."

Sunday, May 23, 2010

High Prices and Fairness

High prices are often associated with greed and a lack of compassion. Companies that charge high prices are considered to be taking advantage of their customers, and unfair to those who don't get the company's service. Yet most people don't think twice about charging a high price when it comes to looking for a job.

Your salary is the price a company must pay for your time and effort, so seeking the best salary is essentially charging the highest possible price for your work. Are you greedy and uncompassionate for doing this? Are you taking advantage of your new company? Not at all — you're just taking part in the fair and widely beneficial system of competitive pricing.

High prices are considered unfair for a couple reasons:

"People who pay high prices are being exploited."

If this were true, then people who receive high salaries would be exploiting their companies. On the contrary, companies choose to pay high salaries to valuable workers just like people choose to pay high prices for valuable services. In free market competition, the price system requires a mutual agreement between buyer and seller — it doesn't get any fairer than that.

"Some people can't afford pricey services."

A service's high price shows how highly valued it is among the population. There are many people who can afford a pricey service but do not value it highly enough to purchase it, which means that the scarce service is left for those who value it the most. Along these lines, your job search matches you with the company that values you the highest among all companies that could have afforded to pay your new salary.

But what about the people who legitimately cannot afford a needed service? For one, these people are greatly benefited by private charity.1 In addition, the price system will help them in two ways. First, a service's high price signals other businesses to start providing that service in order to profit from its high price. The increased supply will drive down the price so that more people can afford the service. Second, the high price encourages hard work and saving, enough of which will allow anyone to eventually get the service.

With ample competition, the price system is fair because both sides have to agree, and helpful in sending resources where they are most valued.

1. The United States is the most charitable nation in the world.

Sunday, May 16, 2010

The Trillion-Dollar Bill, Part II

People who have dug themselves out of serious debt have done so by drastically changing their spending habits, making difficult decisions about which beneficial goods and services to sacrifice for the sake of financial freedom. Similarly, paying off our $12.8 trillion national debt will require a significant reduction in government spending. The only alternative is for the government to pay down the debt with increased tax revenue, but this approach is unreliable.

The government cannot guarantee consistently higher tax revenue — they can only control the tax rates. This is because tax revenue is the tax rate multiplied by the pool of taxable money, and that pool shrinks when the tax rate increases. For example, if the government were to raise everyone's income tax rate to 100%, nearly everyone would stop working, which would leave the government with barely any income tax revenue. In a free society where people act to avoid taxation, raising tax rates even slightly can lower tax revenue; however, lowering tax rates can also lower tax revenue if there isn't enough additional taxable activity. A complex society of millions of individuals acting in their own changing self-interests makes it very difficult to predict how tax revenue will change as a result of tax rate adjustments. As a result, relying on significantly increased tax revenue to pay down the debt isn't a very sound approach.

Even if the government were able to generate consistently higher tax revenue, politicians would be inclined to spend the additional money on popular, vote-getting services rather than using it to pay down the debt. If you were a politician looking to get reelected, and you had a pile of new money to play with, would you use it to make a dent in the debt problem that seems abstract to the voters? Or would you rather stage a press conference announcing a brand-new benefit that you are giving to the electorate? The natural incentives of politicians make it highly unlikely that increased tax revenue would be consistently used to tackle the debt.

Instead of seeking increased tax revenue, our government should find ways to significantly reduce spending without pulling the rug out from under the people who rely on that spending. Congressman Paul Ryan's Roadmap for America's Future is a plan to do just that — gradually reforming unsustainable government programs while adding simple new measures to force these programs to control their spending.

One aspect of Congressman Ryan's plan is to reform Medicare and Medicaid, which together account for 22% of the federal budget (more than national defense) and are the main contributors to projected deficits in the years ahead.1 A major problem with these programs today is that doctors are reimbursed by the government for any medical care given to Medicare/Medicaid recipients, and the government's poor track record of properly reimbursing doctors has resulted in over half of doctors choosing not to see Medicare/Medicaid patients. The lack of available doctors has forced many recipients to go to the emergency room even for basic care, resulting in heavily inflated costs to the federal government. Congressman Ryan's plan would replace the government reimbursement system by giving recipients health-related expense accounts to cover the costs of medical care. Doctors would no longer avoid Medicare/Medicaid patients, and more available doctors would mean lower emergency room costs. In addition, ownership of the financing would force recipients to economize their health-related expenses instead of having recipients ignore medical costs altogether.

With our national debt projected to double over the next decade,2 we need leaders with the foresight and fortitude to reign in runaway spending.

1. The Budget Committee Republicans. A Roadmap for America's Future.
2. The Congressional Budget Office's analysis of President Obama's 2011 budget indicates that our national debt will increase by $12.8 trillion over the next ten years.

Sunday, May 2, 2010

The Trillion-Dollar Bill, Part I

Our national debt is $12.8 trillion. It's hard to comprehend how much money this is, and we rarely consider how this massive debt impacts our personal lives.

The following comparisons help to reveal the magnitude of our debt:

Trillions are way more than millions. Consider that a million seconds is under 12 days, but a trillion seconds is over 30,000 years.

Imagine the combined annual salary of all professional athletes. It would take 1200 years' worth of that salary to pay off our national debt.1

The government will add $1.5 trillion to our national debt this year, which translates to adding $3 million of debt every minute...

National debt grows when the federal government borrows money. Government money comes either from borrowing, printing, or taxing, so any borrowed money must be returned by printing or taxing. Printing money is perhaps the worst possible form of taxation,2 so the best method for returning borrowed money is direct taxation. This means that our national debt is really the amount of money that taxpayers owe.

The taxpayers who pay back the money our government has borrowed are unlikely to even benefit from that borrowed money. To see this, consider that the larger our national debt becomes, the longer it will take to pay it off. A longer period of time between borrowing and taxpayer repayment makes it less likely that the borrowed money was spent in a way that will help the eventual taxpayer. As a result, our gigantic national debt leaves us with a heavy tax burden without giving us much in return.

Our $12.8 trillion debt also means that our government is now spending $400 billion every year on interest. Interest is the cost of borrowing money, so $400 billion is the yearly cost of having such a large debt. Without this debt, those billions of dollars could be used to pay for our current needs! For instance, $400 billion a year is enough to provide private health insurance for all uninsured Americans.3

The costly consequences of our national debt are often unseen, but that doesn't make the debt any less detrimental to us and future generations. My next post will discuss the important process of digging out of debt.

1. This year's combined payroll for all professional football, basketball, baseball, and hockey teams is $9.8 billion.
2. Henry Hazlitt. Economics In One Lesson, pg. 161: "Inflation itself is a form of taxation. It is perhaps the worst possible form, which usually bears hardest on those least able to pay."
3. The average cost of individual health insurance is $4824 a year. Assuming that there are 46 million uninsured Americans, it would cost $222 billion a year to provide insurance for all uninsured Americans.

Sunday, April 18, 2010

Prices and Scarcity

I love this excerpt from Thomas Sowell's Basic Economics:
"Misconceptions about the role of prices are common. Many people see prices as simply obstacles to their getting the things they want. Those who would like to live in a beach-front home, for example, may abandon such plans when they discover how expensive beach-front property is. But high prices are not the reason we cannot all live on the beach front. On the contrary, the inherent reality is that there are not nearly enough beach-front homes to go around and prices simply convey that underlying reality. When many people bid for relatively few homes, those homes become very expensive because of supply and demand. But it is not the prices that cause the scarcity, which would exist under whatever other kind of economic system or social arrangements might be used instead of prices. There would be the same scarcity under feudalism or socialism or in a tribal society.

"If the government today were to come up with a 'plan' for 'universal access' to beach-front homes and put 'caps' on the prices that could be charged for such property, that would not change the underlying reality of the high ratio of people to beach-front land. With a given population and a given amount of beach-front property, rationing without prices would have to take place by bureaucratic fiat, political favoritism or random chance—but the rationing would still have to take place. Even if the government were to decree that beach-front homes were a 'basic right' of all members of society, that would still not change the underlying scarcity in the slightest."1
1. Thomas Sowell. Basic Economics, pg. 13.

Saturday, April 10, 2010

Extending Unemployment, Part II

President Obama said that the number one goal of the 2009 Stimulus Bill was to create jobs. This bill extended unemployment benefits by up to 33 weeks and increased their amount by $100 a month. Unemployment benefit money comes from taxing employers, so expanding these benefits reduces the number of jobs — the opposite of the Stimulus goal.

Existing Jobs Are Destroyed

All employers strive for revenue (income from sales) to exceed costs; otherwise, debt accumulates and failure awaits. Expanding unemployment benefits requires raising taxes on employers, which lowers their revenue. Reduced revenue compels employers to cut costs. A major cost is employee salary, so cutting costs generally means cutting employee salary, which means laying people off. In this way, expanding unemployment benefits sets off a chain reaction that expands unemployment.

There's another aspect worth considering. Say that you're an employer thinking about laying someone off. On a personal level, you'd feel guilty for causing hardship. But wouldn't you feel less guilty knowing that this person would receive expanded benefits, and knowing that you've funded those benefits? Any policy that makes it easier for employers to cut jobs is bad for job creation.

Fewer Jobs Are Created

Expanded unemployment benefits discourage the creation of new businesses because prospective employers know that higher taxation makes it more difficult to profit and to survive. And fewer new employers translates to fewer new jobs.

Additionally, the fact that money is taken from people who create jobs (employers) and given to people who are only looking for jobs suggests that fewer jobs will be created.

Since the Stimulus Bill was signed, the number of Americans receiving unemployment benefits has more than doubled, growing from 4.8 million to 11.4 million people. Recently, there's been an additional benefits extension of up to 20 weeks. As generous as these benefits seem, we should keep in mind that they require taxing employers, which just ends up expanding unemployment! America cannot afford to continue this vicious cycle.

Sunday, April 4, 2010

Extending Unemployment, Part I

Currently, $10 billion a month is spent on unemployment benefits for 11.4 million people.1 That's an average of about $900 a month per person. Normally, these benefits can only be received for 26 weeks, but recently there have been multiple extensions due to high unemployment. People in states with the highest unemployment can now receive benefits for 99 weeks. Sadly, extending unemployment benefits discourages recipients from taking available jobs, which just extends unemployment.

Say that you're offered a job. Which monthly salary would entice you more, $600 or $1500? Clearly, $1500 is more attractive. Now consider hypothetical Joe — unemployed and receiving monthly benefits of $900. Say that Joe is offered a job for $1500 a month. Since he already gets $900, the job would only give him an additional $600 a month. So his reward for taking the job is really only $600 a month, not $1500. Just as you're less enticed to work for $600 than for $1500, Joe is less enticed to take this job. And just as unemployment benefits reduce the incentive to take this job, they reduce the incentive to take any job.

Virginia resident Jerome Boyd has been unemployed for seven months, and currently receives $1200 a month in benefits.1 Jerome admits that he's only looking for jobs that pay above minimum wage, saying, "I can't take something that's minimum wage because I just won't be able to pay my bills." But bills aside, he would be a sucker to take a minimum wage job! Minimum wage is $7.25 an hour, so a full-time job (8 hours a day) would pay $1276 a month (22 working days). Why would he work a full month for $1276 when he can stay home and receive $1200 in unemployment benefits? With these benefits, Jerome is better off avoiding many available jobs.

This tendency to avoid available jobs is natural so long as benefits continue to come. With temporary benefits, recipients have to find work before the benefits stop; recent extensions have significantly delayed this urgency, and have likely led to widespread expectation of future extensions. In this way, the extension of benefits has reduced or removed the incentive for people to take available jobs.

Despite the consequences, extending unemployment benefits seems compassionate. My next post will show how this policy hurts the unemployed by making it more difficult for them to find work.

1. Michael A. Fletcher and Dana Hedgpeth. "Are Unemployment Benefits No Longer Temporary?" The Washington Post, March 9, 2010.

Friday, March 5, 2010

Dollars and Saints

Sean Payton is the head coach of the Super Bowl-champion New Orleans Saints. The Saints are known for their high-powered offense, but few know that their best play this year was made by Sean Payton, before the season even began. Payton gave away $250,000 of his salary so that the Saints would have the funds necessary to sign defensive specialist Gregg Williams. We seldom hear of such sacrifice, but it's actually commonplace; sacrifice is necessary for success in competition.

Payton's goal was to win the Super Bowl. Forced to compete, he had to generate the best possible team with limited salary money. Instead of keeping the $250,000 for himself, Payton improved his team by using the money to acquire Gregg Williams. Williams revamped the team's defense, bringing victory to the Saints and prosperity to the city of New Orleans.

In capitalism, entrepreneurs and executives must compete to attract customers. A company attracts customers only if the price of its service is as low as possible. Low prices are possible only if production costs are low, meaning that resources are allocated efficiently. For example, say that Comcast can more efficiently provide the same Internet service that Verizon provides. If so, then Comcast will attract customers by offering prices lower than Verizon's. Comcast will turn a profit, which is great not only for Comcast, but for the entire country! People will get Internet service more cheaply, and will have extra money to be spent in other industries, which ultimately helps people who don't have Internet service at all.

Success in competition requires an efficient allocation of resources, thus competitors are compelled to sacrifice. In the end, Sean Payton profited from his sacrifice. Instead of equating profit with greed, we should commend risk takers like Payton for trying in the first place, for profits benefit not only the risk takers, but everyone who's counting on them. Just ask anyone on Bourbon Street.

Sunday, February 28, 2010

The Value of Efficiency

Carpe diem. Seize the day. With all the rushing around we do, I'd say we take this phrase to heart. But why do we hurry to get things done? Why do we take on so much in a day? Well, there's a good reason: we know the value of efficiency.

Efficiency means getting desired results without wasting time or effort. We hurry to get things done so we have time left over for fun and relaxation. We take on so much in order to live life to the fullest. Efficient allocation of time leads to healthy and impactful lives.

Similarly, efficiency strengthens economies. Distinguished economist Thomas Sowell cites history to support this claim. For example, China's departure from Mao's heavy-handed government control led to an economic growth rate of 9 percent per year between 1978 and 1995.1 As we discuss America's economy, it's important to understand that efficiency is the lifeblood of free enterprise, yet the antithesis of government.

Companies must be efficient to survive. Successful companies produce desired goods and services without wasting resources. This lowers production costs, which lowers prices for consumers. Thus we get what we need for less, and have money left over for spending (which creates jobs) and charitable giving. The free market system of companies cutting costs to survive has given us our world-class standard of living.

Contrastingly, government does not need to be efficient to survive. In fact, government is often motivated to waste. Take the 2009 Stimulus Bill, enacted to create jobs via shovel-ready projects. The bill's success is defined by the number of jobs created (number of workers used) for a given project. As a result, success is achieved by wasting workers! To illustrate this, imagine that 20 people are needed to build a bridge. The government could do the job with 20 people, but why not hire 100? Sure, manpower would be wasted, but more jobs would be created! This inefficient approach certainly helps the 80 extra workers, but ultimately prevents them from working to meet real needs in America.

This inherent difference between business and bureaucracy is the reason why free enterprise is the backbone of a strong economy. As America faces its highest unemployment in decades, Americans should support policies that promote efficiency.

1. Thomas Sowell. Basic Economics, pg. 27.

Sunday, February 21, 2010

Taxes and Job Creation

Can the government create jobs? Absolutely. But it's important to examine how these jobs are created in order to understand the economic impact of government job creation.

Creating a job requires money, for the worker must be paid. Government dollars come either from taxation, printing money, or borrowing money. As printing and borrowing are unsustainable options, it's apparent that government job creation requires higher taxation. Ironically, raising taxes is the surest way to stifle overall job creation and hurt the economy.

To see this, consider that the overall number of jobs created is the amount created by government plus the amount created in the private sector. Jobs created by the government are made possible only by taxing the private sector, which results in fewer jobs created in the private sector. For example, say that the government uses $1 million in taxes to create 10 jobs. What if that $1 million hadn't have been taken away from the people? Those 10 jobs wouldn't exist, but the public would have had $1 million more to spend on desired goods and services. The companies providing those goods and services would have made more money, allowing them to hire more workers to handle the increase in business. So the $1 million in taxes created 10 jobs, but prevented an untold number of jobs from coming into existence.

Two other factors further demonstrate why raising taxes to create jobs is counterproductive. First, taxes discourage people from starting their own businesses. People already face the daunting fact that two-thirds of small businesses fail within five years; higher taxes let them keep less of what they earn, lowering the likelihood of expansion and their incentive to try in the first place. Second, bureaucracy means inefficiency. To create jobs, government workers are paid to collect and redistribute the taxes and to organize and oversee the jobs. Money intended for job creation must first pay for more government! This problem is bypassed by letting the free market create jobs where they are needed.

Government job creation is made possible by raising taxes, which ultimately suppresses overall job creation. Today, administration officials boast of the jobs that they've created, even as the overall job market plummets. With more government intervention on the horizon, let's hold our leaders accountable for the prosperity their policies are preventing.