We’ve all seen graphs like this:
But everyone knows that’s happening despite the stimulus package only because the bailout wasn’t big enough and/or something to do with Republicans filibustering the Senate. After all, we’ve all been Keynesians since 1965 or so, and in particular we’ve lately become the sort of simple-minded Underpants Gnomes Keynesians whose response to economic unhappiness is:
- Print money.
- Jobs and profits!
Only a few skeptics remain: wookiee-suited libertarians like myself, iconoclastic economists like about two-thirds of the folks whose blogs live on that sidebar there, and… oh yes, the fucking economy itself!
- Stimulus cash didn’t create many jobs, Ottawa’s budget watchdog says (Globe and Mail)
Canada’s $4-billion infrastructure stimulus program was launched with a single focus in mind: jobs.
Now, after surveying those who actually received the federal cash, Parliamentary Budget Officer Kevin Page gives the program poor marks on that goal.
No kidding. Government spending tends to go to companies with strong connections to the — wait for it! — government. Those companies, for reasons which even a glancing degree of cynicism will make clear, tend to do pretty well. So money intended to create jobs — through some form of magic involving mine shafts, I guess — largely went to people with secure jobs, who spent it on countercyclical assets because there’s a fucking recession on. Also, blah blah recalculation blah blah blah Arnold Kling blah. But mostly:
The story’s rather amusing third paragraph reads thus:
The survey reinvigorates an unresolved debate that has long pitted the free-market disciples of classic liberal economic thinking against the post-Great Depression view popularized by British economist John Maynard Keynes that government intervention and deficits in hard times work.
I can think of better ways to reinvigorate the debate between Keynes and Hayek. Like this one: