Monday, August 12, 2013

Transient Stimulus, Permanent Improvement: Much Feared.

Paul Krugman argues that stimuli are not permanent. I observe, though, that their results can be permanent, for the best. Even president Hoover had advanced the start of the construction of the colossal Hoover dam, to provide jobs. Although a stimulus is not permanent, the tasks it accomplishes can be. To wit the Hoover dam, and many other public works of the 1930s, let alone the Interstate FREEway system of general-president Eisenhower in the 1950s. And so it is around the world. Germany uses Hitler's autobahns... And Volkswagen (another Hitler creation) is still around... The same holds for the most major Japanese companies, created by Japanese government programs, starting in the 19C... all the way to American directed stimulus in Japan in the 1950s. All the Very High Speed train projects, in France, Japan, Germany or present day UK, all started as government programs. And also Boeing and Airbus. The Marshall (another general, used to be Eisenhower's superior) Plan was another example of transient stimulus, with PERMANENT consequences. In democracy and related regimes, the ultimate boss of the economy is not the economy, but the government. Trying otherwise is trying to run the chicken without a head: it works, but not very long. It is precisely the fact that a transient stimulus can permanently improve the condition of common folks that frightens the plutocrats. The lower We the People, the higher our lords, relatively speaking. That's what real greed is all about. Not just having more, but having things no common person has. PA

No comments: