Brian Wesbury is one of the best economists around and his column with Robert Stein is tops. So it is with encouragement that I read the new column in Forbes that the U.S. economy may be turning around. The key indicators are improved productivity and the dividends from lower prices (especially oil) that are acting faster and more efficiently than any federal stimulus program, past or prospective.
I support a public works stimulus program in the present environment that builds long term infrastructure --boost American economic competitiveness--getting products to market through better roads and rail connections, for example. We need that anyhow. But now the idea has gotten out of hand. It is hard to see the value of the hundreds of billions now being discussed for education, government worker salaries--and who knows what "shovel-ready" boondoggles that normally couldn't pass legislative or executive scrutiny.
Take government salaries in the states and localities. These have ballooned in the past two decades of prosperity, far outstripping the economy itself. Paring them back has to happen sometime. Some states, indeed, were beginning to run ruinous deficits even in the good times. So, institutionalizing waste in places like California now just seems a bad use of taxpayer money.
The worst of it is that the inflation let loose by poorly inspected trillion dollar spending "stimuli" will come back in due course in the form of one of the most insidious taxes that government can levy on ordinary people: inflation.
