Financial journalists are concluding that austerity is killing Europe’s economy, and they worry the same could happen to the United States. America’s various levels of governments are contracting, laying off workers, and cutting services.
The whole civilized world is doomed, they say, by this reduction in government. To their minds, an expanding government leads to an expanding economy, as measured by gross domestic product (GDP).
Does government drive the economy? How could it? Everything it has, it has taken from us. It produces nothing, but only exists to the extent it can feed off its host — wealth creation aimed at serving customers in the private economy.
Of course, the GDP is just another phony government number. The number doesn’t tell us anything worth knowing. It tells us nothing about prosperity.
Here in the U.S., private business is adding workers, but The New York Times reports that governments are handing out pink slips, and that is hurting the recovery. Some 706,000 government positions have been axed since April 2009.
More than a quarter of municipal governments are planning layoffs this year, the Times reports. Federal and state government support has declined, and property tax bases have been devastated.
Federal and state governments depend upon private sector economic growth that can be taxed. In turn, local governments are dependent upon that same economic vitality — none of which is generated by the government. It’s backward to think government jobs create economic growth when in fact government jobs can only be supported by economic activity in the private sector.
But President Obama doesn’t understand economics or cause-and-effect any better than those writing for the New York Times. He thinks the public sector must grow to compensate for the private sector not hiring.
This implies that all jobs are homogeneous. But a particular private sector job serving customers can’t be replaced in government doing something that consumers don’t want for the same effect.
The worker had that job because he or she produced more than he or she cost the employer in the pursuit of satisfying customers. Fewer customers means fewer jobs are needed. Less economic activity means fewer tax dollars going to government. Fewer tax dollars means government doesn’t have the resources to hire more people.
The idea that hiring more government workers stimulates economic activity stands reason on its head.
Economics professor Tyler Watts makes the point in “The Freemanonline”: “Perhaps we’ve been spoiled by hundreds of years of a generally prosperous and growing market economy into assuming that all workers necessarily add to economic output by exactly the value of their paychecks.”
But professor Watts quickly makes the point that government workers don’t provide the same value. There is no market test to determine if government workers are generating value. Only political rules apply.
The fact that government employment is shrinking is only a signal that economies worldwide are attempting to recover from decades of debt and malinvestment, which includes too much government.
Government austerity is, in the long run, a blessing to the rest of the population.
Photo credit: 401(K) 2012 (Creative Commons)
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Private central banking and some variant of totalitarianism pitting us against each other is a two-edged sword that has been used by a whack job nomenklatura for centuries to disorient, disempower, loot, pillage, enslave and destroy countless millions from all political parties in most nations. [Proof][Proof][Proof] Closed economic systems based on private money being lent into existence, where there is no money existing to pay the interest, ultimately self-destruct. Open economic systems, based on interest-free public money being spent into existence, survive and prosper. Europe, the United States and Canada are currently learning this lesson. [Proof] We vastly outnumber our adversaries. The only power they hold over us is psychological. A peaceful way to stop them is through free and fair elections.
We can quickly eliminate state debt, property taxes, and all interest on personal, business, farm, tuition and infrastructure (e.g., schools) loans, by legislatively allowing the states to create their own non-profit, interest-free banks. This will free up massive capital to grow businesses, fully employ Americans, and unleash enormous prosperity. I will introduce or support legislation to make it happen. The banks will be self-funding, just like the Federal Reserve and the major banks are now, by creating currency out of thin air. Except this time it will be interest-free, tax-free and inflation-free. And it will happen if YOU do YOUR part by supporting and electing the most conservative candidates to make it happen.
The following example illustrates the problem. Imagine two stacks of currency. Each stack contains $1 million in hundred dollar bills that are backed by nothing, perform the same function in our economy, and cost four cents per bill to print. Each bill in one stack is labeled “Federal Reserve Note” and those bills are sold to us by the private Federal Reserve bank for $1 million plus 5% yearly compounded interest, totaling $1,050,000. The resulting debt is used to justify your income tax, increased control and power by government employees, and the incremental loss of your wealth and freedom. Each bill in the other stack is printed solely under Treasury authority and is labeled “United States Note” (called Continental Notes/Currency/Scrip in the 1700s [Proof], Treasury Notes and Greenbacks in the 1800s, and United States Notes in the 1960s). Those bills also cost four cents each to print, but result in no debt, no tax, and no loss of wealth and freedom. Which stack would you use? President Lincoln used Greenbacks and President Kennedy used United States Notes before they were assassinated. President Garfield continued President Lincoln’s policy of issuing debt-free money and he was also assassinated. [Proof]
http://elect.ErnestHuberForCongress.com/
I agree, Ernest goes into more specifics. I have overlapping data, i.e. excerpt of speech given by Lavrentiy Beria (Stalin’s right-hand man) given in 1938, at Lenin University. He gave this speech to, of all people, American students on a ‘field trip’ while studying psychology, via grants bestowed by the Rockefeller Foundation in Leipzig, Germany. It goes like this:
“By psychopolitics our chief goals are effectively carried forward. To
produce a maximum of chaos in the culture of the enemy is our first
most important step. Our fruits are grown in chaos, distrust, economic
depression and scientific turmoil. At least a weary populace can seek
peace only in our offered Communist State, at last only Communism can
resolve the problems of the masses.”
The GOP/DNC/American ignorance are complicit…Semper Fi, bldg 7
Excerpt from a speech given by Lavrentiy Beria, right-hand man to Stalin:
“By psychopolitics our chief goals are effectively carried forward. To
produce a maximum of chaos in the culture of the enemy is our first
most important step. Our fruits are grown in chaos, distrust, economic
depression and scientific turmoil. At least a weary populace can seek
peace only in our offered Communist State, at last only Communism can
resolve the problems of the masses.”
The GOP/DNC/American ignorance are complicit…Semper Fi, bldg 7
Really Past time to teach this truth of self reliance.
It is never past time to teach the truth. Truth can bring change. It has been proven many times.
If the Muslims have anything right it is that no one is allowed to charge interest. Therefore everyone there is solvent because they are able to repay their debts in due time.
The only reason America has interest is because of the banks. It makes them wealthy.
Find a credit union and put the banks out of business. I am stunned as a notary public to hear people say that the banks did them such a favor with a refinance or purchase that will charge them enough interest so they will never own their home. How twisted our thinking has become.