Wednesday, February 18, 2009

What Idiots Fall for Stimulus Hoax?

Now it's time for the latest "Stimulus" deal from your government. Anyone capable of even a tiny amount of economic reasoning can figure out that this is just another method the elite to steal property.

The supposed idea of an economic stimulus plan is to raise the overall prosperity of the country by having the government print new money and spend it. The increased government spending creates new demand for those products and services that the government buys, which in turn will create new jobs for people working to fill that demand. These new workers will have new money to spend, which will increase demand for whatever they choose to buy, which will create more new jobs, and so on. This is known as the multiplier effect, and it was thought up by Keynes, and it's false.

If it were possible to raise the overall prosperity of a country by printing and spending new money, then you could not explain why there is even one poor country anywhere in the world. For all that country would have to do is print a lot of money and spend it. In fact, you could not explain why there is even one single poor person anywhere in the world, for all that we would need to do is print $1,000,000 bills and give everybody one and make everybody rich.

It doesn't work like that. If you gave everybody $1,000,000 of new money, there still would not be any more houses, or food, or clothes, or any goods or any services than there was before. All that would happen is that the price of everything would go way up.

The cause of the current financial meltdown is the Federal Reserve System. By inflating the money supply, it artificially lowers the interest rate, which makes certain investments appear profitable when they are not. The Austrian economists have a complete theory of the business cycle (see Rothbard for example), and they alone predicted this crises. I highly recommend Thomas E. Woods' new book Meltdown.

Printing and spending new money does not have the ability to generate new wealth, but it certainly does have the ability to redistribute existing wealth. The net effect of the "stimulus" spending will be to transfer real wealth into the hands of the early receivers of the new money, and out of the hands of the late receivers.

In other words, the government and the Fed and their friends are stealing from everyone else.

Again.

As usual.

8 comments:

David Howard said...

google: Abolish the Federal Reserve

Ron Paul, President

Morgan Reynolds, Vice President

engineer said...

Germany will send 600 more soldiers to Afghanistan, under the pressure of Gates (USA). News item, Telopolis (German publisher’s website).

Comments (or samples of) from three Germans.
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and I hope that 600 coffins come back, not because I want anything bad to happen to these that stick themselves in uniforms. It would affect me if I knew one personally, but I know none of them and thus they are only figures in a chess game. The deaths of massive numbers of our soldiers an the front would increase the political pressure on the government to eventually pull all the soldiers out.

The money saved could be invested on the home front, for education, or to rescue banks (barf!). (original, "oder um banken zu retten (kotz!)")

Let the USA alone eat the filth that it has provoked for decades.

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More solders means more targets, or they hang out in bunkered barracks and play cards and drink beer. That is not productive outside of the fact that more supplies must be shipped to the most unreal place on the earth.

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Obama and his government, on the other side, in this regard are only Marionettes, and may only do what the Finance Cartel in the background allow.

spooked said...

well I agree the federal reserve is a huge part of the problem... but in terms of the economic framework we have, the stimulus is standard operating procedure. I think the stimulus is far better than the wall street bailouts and at least spreads some money around to ordinary people. Of course ultimately our system is predatory and is geared to benefit the elite...

Ace Baker said...

Money is not wealth, wealth is not money. The net effect of a "stimulus" scheme is to transfer real wealth away from the "ordinary people" and into the hands of the elite.

It is theft. It is counterfeiting. It is illegal, immoral and wrong. I don't support it, I'll put Spooked down as one who does.

engineer said...

Put the reign back on the banker, restore anti-trust, shut down the military madness*, and let the natural processes sort it out.
Any meddling just prolongs the agony. What is, is.

*Money down the drain, and people suffer. Put the 17,000 out there to clean up the national forests.

spooked said...

"The net effect of a "stimulus" scheme is to transfer real wealth away from the "ordinary people" and into the hands of the elite."

Yes, but as I said that is the system we have. And right now most people have no money. The stimulus will at least give ordinary people some money (e.g. via jobs, tax breaks) that they can do with as they please.

"It is theft. It is counterfeiting. It is illegal, immoral and wrong. I don't support it, I'll put Spooked down as one who does."

I disagree with your characterization. I do support the stimulus given the system we have and given the other outrageous things the govt has done.

engineer said...

Any artificial effect has a real counter effect. There is no free lunch.

"(e.g. via jobs, tax breaks)"

Any solution suggested by the US congress has an insidious, poisonous, personal gain motive.

The jobs are overhead, liabilities. Downward spiral.

Tax breaks, with a deteriorating income base? And military expansion? Something is wrong with this equation.

Wovon kommt das Geld, um den Krieg zu halten.

Crack Pot Activist said...

The 'stimulus' package is nothing more than another charge against the giant government credit card. Call it whatever you want, the distribution of funds created out of thin air is just another irresponsible and ill advised loan; another way to increase the overall deficit. The end result is the creation of debt that will have to be repaid by somebody. The true purpose of the stimulus scheme is to serve as a political prestidigitation. The early recipients will be delighted with the crappy little rabbit that Uncle Sam has pulled out of his hat; because they will not be called upon to pay it back. The sick part is that the magical funds will have to be paid back by our children. We should be so proud, what a legacy--endless debt and perpetual war. Add the bailout scheme to the stimulus scheme and we might be able to save some crappy poisoned assets and a few corrupt banks. Too bad that we are also sentencing our children into indentured servitude.