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The Government Cannot Create Jobs

By: Steve Johnson

1/12/2009 - 40 Comments

President-Elect Obama and his economic team proposed the largest economic bailout in history last week, with the primary focus on creating jobs.

The problem with the plan is that the government cannot actually create real jobs. They can only create jobs that are temporary with borrowed money.  The jobs created by government are not profitable to society. Government jobs reduce the wealth of society.

If we allow Obama to create 3 million government jobs, it will only bleed our economy of what little wealth we have left. 

It's been funny to watch the number of jobs Obama plans to create continue to increase in the last few weeks. When Obama first introduced his plan, he said it will create 2.5 million jobs. Then, a few days later it was 3 million jobs and last week it was 3.5 million and now its 4 million. This obviously shows that they are guessing at best how many jobs the plan could create. How can a plan be so critical when it's based on guess work?

Peter Schiff, the economist who Obama should be consulting right now, gave an excellent explanation of how these jobs are not good for the economy in an interview last week.  Here is the video interview on YouTube,


Peter says;

“All the government can do is redistribute the wealth that the private sector creates and if the government is going to usurp resources away from the private sector, it’s going to destroy real employment opportunities and diminish our standard of living. I think a lot of Americans are going to be disappointed that Barack Obama cannot just ride into town and everyone’s home equities come back. All of a sudden they are going to get jobs and their retirement and IRA’s and pensions are going to come back?  Nothing is going to happen. The government has no wealth. The government has a printing press and they can pretend to create wealth by printing money but that illusion won’t last very long. I think we are on the verge of another major crisis that is far greater than the one the government is trying to deal with now and that is the coming collapse of the value of the US dollar. “

Again – the government cannot create jobs that will not further deteriorate the wealth of our nation and our economy.  We need the government to drastically contract, rather than expand – but unless the public understands this they will not be able to vote in new politicians that will reduce government and stop the further destruction of the economy.  But that is unlikely because the major media outlets and educational infrastructure is vastly controlled by the thinkers of more government expansion – as we clearly saw in the presidential and congressional elections.   The only thing Obama is right about in this situation is the seriousness of the consequences of how we deal with the economy. 

The real solution to the economic crisis is to drastically reduce the burden of government on our society, so that entrepreneurs can create profitable jobs that once again create wealth.  The government has been expanding for decades and now consumes about one-third of all wealth created within our society.  That is going to change, one way or another, but it would be better if we voluntarily reduced the government before we are forces to after the collapse of the dollar. 

The government cannot create jobs.

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