The first thing you notice if you try to apply whatever learning you got in Econ 101 in college, is that there was a lot of theory taught in that course that has never made it to the real-world economic stage to be tested.
That can't be said of Keynsian Economics, which, at it's core, is the economic lifeblood of the (D)emocratic Party. The basic nut of Keynsian Economics is that you tax the Hell out of the People and their businesses, and use the money to create a huge governmental entity, and that provides jobs. Occasionally, that entity can actually stimulate job growth, but it doesn't happen too often, and the examples aren't usually crystal-clear examples of Keynsian Economics, they usually have some elements of free enterprise in them. As such an example, the (D)s are fond of trotting out the WPA and the CCC of FDR's Administration in the 1930s. They rightly point to the national treasures that were created out of nothing by these Keynsian examples. Roads, many of which still exist 80 years later, bridges on those roads, attractions at the end of those roads, such as our own Timberline Lodge here in Oregon (you saw it in Jack Nicholson's "The Shining"), all fine examples of Keynsian Economics working.
Or are they?
Well, my Dad worked for the CCC, as a Camp Doctor. He was already in the US Navy as a doctor, and FDR forced the Army and the Navy to provide doctors for the CCC camps. The Navy probably was not funded directly at 100% of my Dad's cost, though. The CCC probably paid his base salary, and that was all. The Navy had to eat the cost of his travel, the Army provided for his life while at the camps he doctored at, and he, himself, had to provide things such as a car, uniforms, etc.
When the Government takes from the citizens in taxes, then spends that money to pay a salary, it is said that it has "created a job". That's very Keynsian, but it ignores the other expenses involved, which Keynsian Economics doesn't account for. I would guess that for every $10,000 the Gov't spends for a salary, it also spends $5,000 to help it spend that first $10,000. It has to have expenditure Administrators, there has to be computer networks, there is paperwork, always paperwork. Yes, private business has these expenses also, but they are motivated to reduce them, and they DO reduce them. It costs private business about half of what Government takes to administer a salaried position.
When I worked for the Multnomah County Sheriff's Office in Portland, OR, the Sheriff employed about 1,000 people full time. As of when I retired, there were 70 Enforcement Deputy Sheriffs, about 700 Corrections Deputy Sheriffs, and two hundred civilians, more or less. There was a Human Relations staff of about a dozen among those civilians. Most Deputies considered them parasites. We never could figure out just what contribution they made to the organization, except maybe to file all the State and Federal regulations on how to treat employees. That should have been a one-half FTE (full-time equivalent) for a clerk, but there is a "manager" there who draws as much or more salary than a Captain of Corrections. The Empire of HR in the M.C.S.O. is huge, and has tentacles that reach everywhere within the department. The HR "Director" gets to pass on all promotions, rig the promotion boards, etc, and yet she's never done a day on patrol or a shift in the jail guarding prisoners.
Nope, if the M.C.S.O. could be run by a private company, the first thing that company would do is dump the HR Division. They would contract out the rules-keeping, and contract out when promotion boards needed to be held, too. The HR budget could then be seriously reduced and spent on actual production: more enforcement or Corrections, what the Sheriff is actually there to do.
Back to the overall theory. My cited example is just the tip of the iceberg, actually, and the M.C.S.O. probably operates much more efficiently than the Federal Government. The State government has gotten quite a bit leaner, too. The reason for those improvements in efficiency?
Balanced budgets. Living on a budget that isn't automatically increased by 7% per year like every Federal Department's budget is.
Put it this way, folks: if Keynsian Economics can't be made to work with a bloated Government which allows itself a 7% increase in expenses ever year, year in and year out, then there is something wrong with Keynsian Economics at it's core.
My take on what's wrong is two words: mission creep. Over the years, the Government has been the one to define it's own role, and it has defined it ever and ever bigger. Both parties have done this, so it isn't just a (D)emocratic Party thing. Ever since the Eisenhower Administration, Government has expanded it's role, and almost exponentially. The population hasn't expanded exponentially, so what needs to be done?
Rethink Government itself. Get everyone together in a big room, give them the goal of cutting the cost of Government by X-per cent, and the size by X percent of the Government payroll. We get to those percentages with our excellent business academicians, who are actually good at such roles defining things.
When it's time to rent out that Big Room, let me know. I want to go there, just to watch how the expressions of those with oxes to be gored change between going in on Day One and coming out at the end of that session.
Yep, we could use this bitter lesson in economic failure we've had to endure as a steppingstone to a brighter future, but that won't happen if we follow this fellow's advice and just reduce the expectations of recovery, but that is probably what we will get from the President this week: reduced expectations. OK, Mr. President, let's reduce those expectations, and while we're at it, lets reduce those expenditures of Government. A Government that admits it can't achieve the dreams it's been taxing us for should be willing to take less money from us, right?
