Saturday, February 21, 2009

Nixon V. Obama

In his State of the Union Address in 1971, President Richard M. Nixon asked Congress for a full employment budget, “designed to be in balance if the economy were operating at its peak potential. By spending as if we were at full employment, we will help to bring about full employment.”
Nixon also promised that his budget will stimulate the economy “and thereby open up new job opportunities for millions of Americans.”
What I don’t hear is a promise that government will “create jobs.”
Obama: “The state of the economy calls for action, bold and swift, and we will act — not only to create new jobs, but to lay a new foundation for growth.”
Google the term “create jobs” and you get 134,000,000 hits. But does government create jobs or, as Nixon put it in much better economic days, does it set a policy that opens job opportunities? Unemployment stayed at 5.9% or lower from 1971 until Carter took the presidency, about the rate that most economists would call full employment
depending on your particular economic theory. Creating jobs implies that government can do such. It can in a literal sense, but jobs that take money from free enterprise have historically added to the national debt and only worsened our economy.

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