5 Myths That Lead To Gov’t Interference In The Economy

24 Feb, 2009 by John Hawkins

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The idea that the government can and should “fix” an economic crisis comes from a number of bad assumptions.

#1) That the government is the primary factor in economic growth: The government does almost nothing to grow the economy. In fact, as a general rule, the only way the government can positively impact the economy is by becoming less involved in it via cutting taxes, regulations, or government power.

#2) That the economy should always be good: The economy tends to run in cycles. You have good times and bad times. Not only is it not possible to avoid the bad times, the more the government tries to lessen their effects, the weaker it tends to make the upward cycle.

#3) When people are hurting, it’s the government’s responsibility to move (Thank you for that, W.): Actually, having the government too involved in our lives is much more of a threat to the lives, liberty, prosperity, and happiness of the American people than having the government not involved enough. That’s what the Founding Fathers believed and it’s why they took great pains to limit the power of government. Unfortunately, far too many of the constitutional limits they put on the federal government have been ignored for far too long and the American people are now paying a terrible price for it.

#4) That the government knows what it’s doing: The economy in general — and even particular sectors of the economy — are so complex that few people understand them. When even the experts disagree, what makes anyone think the members of Congress, many of whom don’t understand economics and have never run a business are capable of dealing with these issues? These guys are world championship bullsh*tters, not geniuses at business.

5) That the government’s real interest is in fixing the economy: Even the blowhards in Congress understand that there are economic cycles and that usually, the things they’re doing aren’t going to “fix” the economy. So, why do anything? Because it’s really about using economic problems as an excuse to push their agenda, not about “fixing” the economy.