Let Them Fail

Good jobs are in high demand these days.  Yet, unfortunately, they’re in limited supply.  Gone are the days when any old hack could show up with a tie and a smile, shuffle papers around a cubicle, surf the internet all day, drink coffee on the house, and collect a comfortable paycheck every two weeks.

To get a good job these days you must possess a financially valued skill that can turn a profit for your employer.  And, above all, you must work your ass off.  That’s our experience, at least.

Most university degrees no longer cut it.  Particularly those in soft subjects like sociology of zebras in captivity.  Recent graduates with degrees in such fluff are discovering their learned knowledge of worthless matter…is worthless.  Come to find out, it hardly qualifies them to operate an espresso bean grinder.  Who would have thought?

On Tuesday the Senate demurred to President Obama’s jobs bill, which included tacking $447 billion to the debt to create jobs the market doesn’t warrant.  This must be, without a doubt, the most intelligent thing the blockheads in the Senate have done this century.

By refusing to spend money it doesn’t have to create jobs the world doesn’t need, the government’s giving the economy a shot at making an honest recovery.  Of course this was all discovered many years ago…

Do You Get It?

In May 1939 after staggering through a 10-year depression, FDR’s Treasury Secretary, Henry Morganthau, addressed Congressional Democrats on the futility of stimulus…

“We have tried spending money.  We are spending more than we have ever spent before and it does not work … I say after eight years of this Administration we have just as much unemployment as when we started … And an enormous debt to boot!”

But here we are, decades later, rediscovering that spending money to create jobs doesn’t work.  We don’t know exactly why this is…but we do have an idea or two…

We humans are prone to imbecilic adventures from time to time.  We must forget the lessons of the past so they can be punished back into us.  We must relearn what we once knew so we can discover what we had forgotten.  Do you get it?

The country would be better off today if the 111th Congress hadn’t passed the $787 billion American Recovery and Reinvestment Act of 2009.  Sure, the recession would have been deeper and more severe.  But without the stimulus the economy would have touched bottom where a firm footing for rebuilding the economy could be established.  Instead, here we are, almost three years later, and we’re slogging along, knee deep in wet mud.  Finally, it seems, the Senate has gotten a clue.

“Progress, far from consisting in change, depends on retentiveness,” explained 20th Century Philosopher, George Santayana in The Life of Reason.  “When change is absolute there remains no being to improve and no direction is set for possible improvement: and when experience is not retained, as among savages, infancy is perpetual.  Those who cannot remember the past are condemned to repeat it.”

Alas, there appears to be some agonizing relearning to do…

Let Them All Fail

We’ve been watching the Occupy Wall Street protest with disinterest and disregard.  We thought it would be over shortly.  Yet when it didn’t quickly end, we chalked it up as positive proof that there’s no limit to the distance people will go to line up like mooing cows and beat a mindless drum for the sake of incoherence.

But with the movement approaching one month old, and its momentum increasing across the land, we’ve had to challenge ourselves to understand just what it is that the protestors want.  From what we gather they believe they got a raw deal because there are no good jobs and they owe $100,000 in student loans.  They are angry because Wall Street got a bailout and they didn’t.  “Bail Out the People—Not the Banks!” they shout.

But why should the people get a bailout?  And who should pay for it…the evil rich?

It’s absurd.  The point is the protestors have every reason to be mad as hell about the government bailing out the big banks.  At the same time, they shouldn’t expect a thing from the government.  For there is nothing the government can do to fix the economy…except, perhaps, to get out of the way.

Here, in the spirit of constructive discourse, we’ll take a moment to offer a suggestion.  It’s called: No Bailouts.  Not for the banks.  Not for the people.  Let them fail, or prosper, if they deserve to.

Throwing good money after bad through more and more bailouts will not somehow suspend the business cycle.  Who knows?  Maybe it’ll help cushion the fall.  Or maybe, flooding the globe with paper money through endless bailouts could exacerbate it.

By zombifying the economy, the government could stretch the down cycle into a long, drawn out, slow motion depression.  Or, with enough determination, they could destroy the currency.

Attempting to halt gravity, and deny the existence of the business cycle, is arrogant and futile.  Particularly in light of the fact that there’s no historical precedent to support the notion that massive government stimulus can achieve economic productivity.  It was attempted during the Great Depression and it has been attempted in Japan for the last 20-years.  In both instances it hasn’t worked.

It should go without question…there are consequences for actions.  Running up debt and spending money you don’t have may result in going broke.  It’s a fact of life.  Neither people, nor banks, should expect, or even want, a government handout.

Let them fail.


MN Gordon
for Economic Prism

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