Posted by
Always To The Right on Thursday, January 08, 2009 3:17:10 PM
Barney Frank never met a government spending program he didn’t like,
at least until now. While expressing his overall approval for the
scope of Barack Obama’s stimulus proposal, Frank told NPR that it
relies too much on tax cuts to stimulate the private sector and not
enough on government confiscation of capital for redistribution by
Washington elites.
Well, OK, he didn’t quite put it that baldly, but he came close:
House Financial Services Committee Chairman Barney Frank
(D-Mass.) said Thursday that President-elect Obama’s stimulus plan
spends too much money on tax cuts for his taste.
Frank said on NPR’s “Marketplace Morning Report” that he believes
the spending package Obama supports will be large enough to help the
ailing economy but that he does not entirely agree with how the money
will be used.
“I have some difference because I think they may be doing too much
tax-cutting and not enough direct spending from the standpoint of
immediate job creation,” Frank said.
Yes, well, no one would ever accuse Frank of being an economic
whiz. Taking capital out of the markets now to fund public-works
projects that will take months or years to organize will not only not
create jobs in the short term, it will actively damage the investment
engine that will maintain the jobs we have now. Barack Obama appears
to realize this, at least dimly, while Frank just remains dim.
For an explanation of how massive public-works programs fail to increase overall employment, Heritage Foundation has a clear explanation, via Ed Driscoll:
FDR had the same idea as Frank, which was the confiscation of
capital from “the rich” and redistribution through public-works
programs and welfare assistance. Not only did it not work the first
time, but the second phase of the New Deal resulted in an increase
in unemployment greater than the percentage of total unemployment today
between 1937-8. Only the war put America back to work, primarily
because millions of men who would otherwise have been in the workforce
went into the military instead.
Government-controlled capital gets used in the most inefficient
manner possible. We’re headed towards another several years of
learning that lesson again. Too bad Frank and the rest of Congress
didn’t learn the lesson of intervention from the self-inflicted debacle
of the housing bubble.