When you go to the polls tomorrow I hope you are as incensed as I am at the ongoing claims by entertainment media and government employees that they are running the economy and making “jobs.”
Where does such idiocy come from?
In case you’ve never studied economics, here are the basics of what I’ve learned:
The Federal Reserve Board set monetary policy, meaning how much money is in circulation and therefore how much interest rates will be.
The government establishes fiscal policy, meaning the ways in which they regulate commerce. But the fact is fiscal policy can actually do only a few things.
1. The government can increase or decrease the amount of money it takes from people and businesses by increasing or decreasing taxes. In turn, higher taxes usually compete for money and suppress the use of money by the private sector. Lower taxes generally decrease competition for money and increase the use of money by the private sector, which of course is the real economy.
2. The government can give tax breaks and incentives and even grants to some groups, providing a stimulus to certain areas or industries. But it can only do that by taking money away from other groups, regions or industries.
3. The government can spend and tax so irresponsibly that the value of its money eventually will decline in the view of others in the world. This helps create inflation and lowers the standard of living of its people. Or it can act responsibly and also foster a strong banking system wherein money from other places will flow into the nation.
Fiscal policy is actually a pretty complicated subject, but I think most actions can be classed into the three categories I’ve listed above.
But to make my point bluntly, the president does not create jobs. The Congress does not create jobs. They can manipulate the economy, perhaps for better and certainly for worse, but that’s it.
If you’re voting this week with “jobs” in mind, then the only question is whether those in power have done things to hurt the economy or help it.
Do not think for a minute they can actually create jobs or wealth. They can only fabricate these things with resources they take from others.
Please, vote on the big picture.