Harvard Study Reveals: Incumbents KILL jobs
FACTS are Facts, Incumbent Spending KILLS jobs***
OH, my GOD! OH, my GOD! OH, my GOD! OH, my GOD! Rajjpuut, who distrusts big government mightily, has seldom enjoyed writing anything as much as this blog . . . . it began with a recent Rasmussen poll that said that only 18% of likely voters believed that additional government spending would help the economy. Were they right, those 18%? Certainly our president acts like he believes they’re right. Where to find the truth, where to turn?
Truth is crucially important to the well-being of a democratic-republic. Unfortunately, the newspaper of today is quickly becoming a dinosaur. Meanwhile, only one among the large broadcast TV news organizations is actually trusted more than doubted (FOX News) according to media polls from the last few years. Six important things that clearly can be and must be said about mainstream “lamestream media” today (whether broadcast or print media) are:
1. They love talking to politicians and celebrities in other fields like sports and entertainment.
2. They seem to believe it’s impossible to learn much about government from everyday citizens.
3. They actually believe that a politician and what he/she has to say is “important news” to the detriment of actually chasing down real news about the pain politicians bring into our daily lives and reading and studing proposed laws.
4. They have virtually no curiosity and believe almost anything a liberal or progressive politician tells them and doubt virtually everything a conservative politician utters. And, thus lacking that all-essential curiosity . . . .
5. Add little of value to the American scene. The so-called “Fourth Estate” has degenerated into public relations helpers for the political class (politicians and those whose jobs or livelihood are enhanced by politicians).
6. They have long ago forgotten what real journalism is about.
Rajjpuut intends to remind them what journalism is all about. Let’s take a look at their “a-curiosity” or “in-curiosity” a bit closer . . . at their tendency to believe what politicians they favor tell them and what Americans themselves believe about incumbents. One of the biggest reasons that term limits for congressmen has been an unpopular item is the perpetual editorial you’ll see about the need to maintain the status quo and support a district’s rep or state’s senator because that incumbent is seen as valuable. The idea that virtually all idiot mainstream media hold dear is that incumbency translates into tangible benefits that can be measured economically and in prestige. A one-word definition of that economic and prestige benefit? PORK!
Of course that old wives’ tale is based upon the most common economic myth of all, that private sector jobs can be efficiently and profitably be created by actions that politicians make. Bah humbug! This myth is the bedrock foundation of that idiotic notion known as “Keynesian Economics.” Keynesians consistently claim to have refuted the commonsense proposition that if 75% of all tax dollars were returned to the taxpayers and politicians had to live within a sound budget on the other 25%, this country would see a resurgence of unbelievable proportions . . . an economic miracle that would within half a decade eliminate our national debt and within four decades wipe out all the non-funded obligations. More on proving that later . . . but lets talk about PORK . . . .
While it might be true that PORK helps some, let’s say 3-4% of the populace, it’s undeniable that PORK and other unwise government spending boondoggles and government interference boondoggles (GSBs and GIBs) depreciates the lives of 96% of all American businesses and individuals. However, that last sentence is totally at odds with the myth we’ve been talking about. This myth about the value to a district of an incumbent representative and therefore the need to continually re-elect him is the single greatest driving force behind the swallowing-whole of the private sector by the government . . . . which occurred slowly since 1933, but which has accelerated under progressive politicians from LBJ to the present . . . to be concise every president except Ronald Reagan.
You remember Ronald Reagan, the fellow in office when the Berlin Wall came down and 21 million new jobs were created? And remember this, Reagan was obstructed by Democratic majorities in the house of representatives (the Contract with America in 1994, was the first time that Republicans held a majority there since 1954) for all eight years. He was forced to compromise with the Democrats and let through a huge shipload (whatever) of unwise spending bills to get his tax cuts approved. And Reagan wasn’t proud of the deficits and debt created on his watch . . . but what else could he do? The decade of the 90’s became the second most productive in history given the impetus of Reagan’s years (the most productive was the Roaring 20’s – more on that in a moment).
Four months ago, three Harvard professors at that university’s School of Business (Lauren Cohen, Joshua Coval and Christopher Malloy) were researching the “Benefits of PORK myth.” By the way, ‘tis a well known fact that in large part, our universities are dominated by left-wing professors and even our business schools presumably are mostly believers in the Keynesian myths that the Nobel Prize people find so enthralling . . . so it’s utterly REFRESHING to find real curiosity among professors about government activities. Anyway, back to the chase: the threesome named above were examing correlations between “politically-connected firms and powerful legislative chairmen” when the rock they tripped over turned out to be the ultimate gold nugget of truth. In a phrase their serendipity kicked up the troublesome fact that GOVERNMENT SPENDING KILLS JOBS or as Mark Hemingway at Beltway Confidential put it . . . WHEN GOVERNMENT SPENDING GROWS, THE PRIVATE SECTOR SHRINKS. And as they got deeper into it, they concluded that SPENDING by INCUMBENT POLITICIANS KILLS JOBS. You can look over their research (finished three months back) here:
Their study examining government earmark and budget data from the past four decades – found this trend to be consistent across all variables. Specifically, it affected both large and small firms in large and small states, and it followed the ascension of committee chairmen in both the House and Senate. The study found also that damage to the private sector was “partially reversed” when the committee chairmen either lost their seats or retired.
Let us be clear here, these three professors did what journalists should have long ago done, they went to study the assumption (in logic known as the “premise”) that as a state’s congressional delegation grew in stature and power in Washington, D.C., local businesses would benefit from the increased federal spending sure to come their way . . . but they discovered that the opposite was true. Indeed, companies experienced lower sales and downsized, cutback, retooled and retrenched by cutting payroll, R&D budgets, and virtually all other expenses. Their study showed that as incumbency acculated following a congressman’s ascendancy to the chairmanship of important committees, the average firm in his state cut back capital expenditures by roughly 15 percent.
Now Rajjpuut can hear the scared liberals and progressives in particular screaming, “But, but, that’s . . . just one study.” That’s true. One study that cries out for term limits for politicians and limited government and utter fiscal responsibility.
Here’s a slightly related study:
This link is about a study in which a government spending boondggle took Spain from a booming economy with 3% unemployment 13-14 years ago, to being only behind Greece among struggling European countries and to 17.8% unemployment last year and almost 21% this year. How? By forcing their country into a green jobs commitment similar to what President Obama is now proposing. Obviously, the Spanish citizens are NOT better off because of government spending and government interference. Notice those words in italics “by forcing.” No matter what country you live in, politicians tend to accumulate power and status as they accumulate “tenure.” As power nears abolute power, corruptness such as the PORK in the Harvard study and the “forcible rape” of Spain grow more and more probable. Power can corrupt. Absolute power virtually always does corrupt . . . .
Ya’ll live long, strong and ornery,
*** three brief essays to convince anyone who “buys into” common sense are:
the most famous essay in economics but one the Keynesians pretend doesn’t exist
is “The Broken Window” parable
is the “one lesson”
is the entire book “Economics in one Lesson” from which the broken window and one lesson come