Conservatives lose economic arguments, not because they are wrong, but because gorillas are cute.
On the Opinion page of the St. Paul Pioneer Press today (“Minnesota Senate’s bonding bill a responsible action”) state Sen. Keith Langseth, DFL-Glyndon, grabs the guidon of government on the march and hails the Senate’s $329 million public works bill as “the most responsible thing the Legislature could do to help the state climb out of the recession.” More than half the projects in the bill, he writes, are “asset-preservation projects” that are “ready to go,” “will employ local construction workers all over the state,” and “will immediately create jobs.”
Blarney, said Jonathan Blake, vice president of Freedom Foundation of Minnesota, in a Pioneer Press op-ed (“Minnesota Senate bonding bill is irresponsible”) last week, “How many jobs will these projects actually create?” Blake points out that Langseth’s own estimates range from 5,000 to 3,500 new jobs while some media reports suggest 15,000 jobs will be created. Last year DFL Senator Steve Murphy promised that tax increases in the massive transportation bill, passed over the governor’s veto,would create 33,000 jobs “in the very first year.” Murphy now admits his estimate (a polite euphemism for bullsh*t – he didn’t even try to get it right) was off by 100 percent. Blake concludes the job numbers were being “pulled out of thin air.”
And, asks Blake, “How exactly does a gorilla exhibit stimulate the economy? Are bike trails really the most efficient way to put people to work? Why should all state taxpayers fund a new runway in Bigfork?”
And with knockout punches on job estimates and project value, Blake clearly wins the debate, and conservatives lose the issue.
Here’s why. Once the threshold economic principle is breached and liberals get conservatives arguing about the details of tax and spending plans, how cute gorillas are, liberals win. Remember, the public thinks gorillas are cute, and if the perception is that somebody else is picking up the tab, they want to go look at gorillas. They like their bike paths, and they don’t have any (or so it seems) out-of-pocket expense for them. Airports seem important, why shouldn’t government pay. We need roads and bridges; who’s going to build and maintain them if not the government?
If conservatives hope to make any progress at all winning the hearts and minds of the public, they have to keep the context of the debate on the threshold principle, the “big lie,” if you will. In this case the “big lie” is Langseth’s claim that government spending, in and of itself, creates jobs and “will help the state climb out of the recession.”
Government spending doesn’t create jobs. We’ve been down this road before. In fact, non-essential government spending is a swift kick to the privates (pun intended) that is doubly painful. Government can’t spend a dollar building roads, bike trails or anything else of benefit to chest-beating primates until it takes the dollar from a productive taxpayer, i.e. someone who has with his or her labor earned a dollar by creating a dollar’s worth of value for someone else. The dollar spent by the government is an unearned dollar not spent by the person who earned it. The dollar used by the state to “create a job” is a dollar not available to the person who earned it to create a job, support an existing job or invest so as to allow someone else to create a job.
The double whammy occurs when government spends the dollar on a non-essential project. The reason St. Paul’s gorillas need subsidized housing, and Rochester needs a subsidized home for international volleyball events, is that no private individual would invest in those enterprises. In other words, there is a more efficient use of capital creating a higher return for the investor because people want or need something more than they want to go look at gorillas or watch the French actually compete at something. When government subsidizes something because the market will not support it, government is diverting capital from its most efficient use to a lesser use and the community as a whole loses, which is hardly a line to pull us out of a recession.
Government can’t create jobs, it can only change the mix of employment, and when it does so through non-essential projects undertaken simply because they are “ready to go,” it harms not helps the economy, is the threshold principle that conservatives must defend. Why argue with liberals about how wrong their job creation numbers are when the right job-creation number is zero? Why argue about whether gorillas have educational value (might be nice if the kids studied economics) or if volleyball centers draw international events to Rochester when the key to pulling out of a depression is getting dollars flowing to their most productive use? To where we get more for less, not less for more.
If creating jobs were as easy as passing a bonding bill out of the state Senate, why did Langseth and his cronies stop at $329 million? Why not double that number and create twice as many jobs? Triple it even. Seems the “most responsible thing the Legislature could do” is pass an even larger bonding bill. And then, just to create even more jobs, legislators could go on a window-breaking rampage. Just think how many glaziers we would need to employ!
Update: See “Rep. Matt Dean on Bonding for State Buildings“