Monday, June 23, 2014

One Lesson Blog Post 1

     The book "One Lesson" by Henry Hazlitt, offers some great insight into the world of economics that I agree with! One of these topics that struck me as spot on is government spending. President after President have said increasing government spending will revive our economy and boost us to the top and time after time it fails. Hazlitt offers great insight as to why that is happening. I will also give input from another article written by Casey B. Mulligan an economics professor at the University of Chicago. He argues that government spending does increase the economy short and long term. In this blog I will refute that claim and use Hazlitt's "One Lesson" to do so.
     Mulligan's examples he uses are government spending for the military and government spending to build new roads.  He states in his article that "Perhaps road building and scientific research would even expand the economy in the long term as they made labor and capital more productive." A clear statement that violates Hazlitt's theory. Hazlitt believes government spending should only occur if the necessity is their to build. Building for new jobs and boosting the economy is not what Hazlitt sees as helpful. Hazlitt states "I am here concerned with public works considered as a means of "providing employment" or of adding wealth to the community that it would not otherwise have had." I have the same view as Hazlitt has where I believe that this is not the solution to the economic woes. Taking tax money and spending it on unnecessary things such as military overgrowth or new roads just to increase jobs is wrong. You are taking away from the tax money that people would have spent on needs for themselves instead of building a new road that will provide 500 jobs for one year.
     I feel as though this is a big problem in politics today, governments are set on spending their way out of the debt no matter what the means are. This view by Hazlitt is just one of many that teach you to look beyond the immediate satisfaction and see the trickle down effect at its worst. It is hard to look past this new road or this new shiny bridge and the people working on it to see the underlying problem. That the money used for the project was tax dollars that could have been used on needed things. Our government and society have a long way to go to discover this true meaning but hopefully for everyone's heartache it is sooner than later. In my next blog post I will discuss another one of Hazlitt's topics that many people either disagree or agree with.

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