Wednesday, September 28, 2011

Governments don't create prosperity ~ By John Stossel

John Stossel weighs in on the "government spending creates jobs" issue. After spending trillions of dollars in order to stimulate our economy, unemployment remains high and the economy remains stagnant. One of the points that Stossel makes here is how uncertainty continues to drag down our economy. Pour all the money you can into improving the infrastructure, in other words, and nothing will change if small business - the engine of the economy - is reluctant to expand. The private sector needs to be expanding in order for our economy to prosper.

Governments don't create prosperity

By John Stossel

September 27, 2011 ~ 3:23 pm Eastern

© 2011

Politicians say they create jobs, but they really don't. Or rather, they rarely create productive jobs. Government has no money of its own. All it does is take resources from one group and give them to another. The pharaohs might have claimed they created work when they ordered that pyramids be built, but think how much richer (and freer) the Egyptians would have been if they'd been allowed to pursue their own interests.

It's individuals in the marketplace who create real jobs – when they have the protection of life and property under the rule of law.

Economic freedom is the key. The theory couldn't be more clear, and at this late date in human history, it shouldn't be necessary to rehearse the abundant evidence. Look at the various indexes that correlate economic freedom with economic growth. The healthiest economies are those with the most economic freedom. Unemployment is low in those places – 3 percent in Hong Kong, 2 percent in Singapore, 5 percent in Australia

Alas, the United States places ninth, behind Canada, and those countries with the least economic freedom have few real jobs and no prosperity.

Unfortunately, most politicians still don't understand – or have no incentive to understand – that economic freedom, and therefore less government, creates prosperity. Well, maybe that's changing. This year is first I've heard so many presidential candidates talk about the private sector. Indeed, one candidate, former New Mexico Gov. Gary Johnson, told me he created "not one single job. ... Government does not create jobs."


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