Showing posts with label unemployment. Show all posts
Showing posts with label unemployment. Show all posts

Tuesday, February 23, 2010

Why does the Government get Involved?

So the Senate just passed the job-creation measure bill. My question is, what do they think they are going to accomplish by this? Let's break it down a little and see.

Short-term Effects
In the short run, there will be more jobs created through the highway trust fund, which will be focused on the transit system. Businesses will perhaps have a little bit more profitability due to more people working. Perhaps they will even start to hire some more employees. But what will happen when the government decides to stop the highway trust fund and have things go back to normal?

Long-term Effects
As soon as the government stops the program, the unemployment rate will increase again. As a result, businesses will receive less money from customers because there won't be as many people working. Businesses will respond to this by cutting jobs. That's the cost that they can control remember. Unemployment will continue to increase when this happens, putting us back where we were originally plus a $15 billion increase in the national debt.

Man, that sounds like a good idea! Let's do it! I honestly don't understand what these senators and congressmen are thinking. Aren't we supposed to learn from history? I guess that lesson was skipped in politician school. Why can't they just let the market work itself out? I suppose that would just be too easy.