Government Spending That Isn't Smart
Not long after President Obama proclaimed in his second inaugural that "an economic recovery has begun," we learned that the U.S. economy actually shrank in the last quarter. Many economists believe this is a temporary setback. This recovery may be the weakest in American history, but the economy isn't cratering either.
Still, you can bet that if the economy continues to contract, Obama will propose the same remedy he always has: more "investments" in education, infrastructure and various industries of the future. It seems that whatever the ailment, Dr. Obama always writes the same prescription.
This is hardly shocking: Building roads and schools is a big reason why God created Democrats in the first place. And identifying the Next Big Thing -- and taking credit for it -- is something of a vocation for many liberal policymakers.
But are these really the drivers of economic growth?
Higher education in particular is almost universally championed as the key to "winning the future" -- a buzz phrase the president borrowed from
Often channeling such writers as
Now, obviously, education is important and necessary for a host of reasons (and nobody is calling for "disarmament," whatever that means). But there's little evidence it drives growth.
"The simple one-way relationship ... -- education spending in, economic growth out -- simply does not exist. Moreover, the larger and more complex the education sector, the less obvious any links to productivity."
Think about it this way: Growing economies spend a lot on education, but that doesn't necessarily mean that spending makes them grow. During the so-called Gilded Age, the U.S. economy roared faster and longer than ever before or since, while the illiteracy rate went down. But the rising literacy didn't cause the growth. Similarly, in the 20th century, in places like
There are similar problems with claims that infrastructure spending will pay off. When I was in college, prominent experts and journalists --
Obama surely wants to see some real economic growth. Perhaps the problem is that he thinks investing in a much bigger cart to put before the horse will get him where he wants to go.
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Government Spending That Isn't Smart | Politics
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