Comments on: Stop it, or you’ll go blind http://www.kewpid.net/2009/03/05/stop-it-or-youll-go-blind/ Dan the Student Wed, 28 Jul 2010 12:32:59 +0000 hourly 1 http://wordpress.org/?v=3.0 By: the Rt Hon. John Lee LJ http://www.kewpid.net/2009/03/05/stop-it-or-youll-go-blind/comment-page-1/#comment-8582 the Rt Hon. John Lee LJ Sat, 23 May 2009 11:45:39 +0000 http://www.kewpid.net/?p=325#comment-8582 And the policy which overwhelmingly works is deregulation. This is a policy which rejects as authoritarian the old command-and-control system of governance and recognises the efficiency of regulation which properly aligns incentives. Whilst an economic stimulus in the short run will obviously boost the economy, we must ask at what cost. Economic theories now suggest that government intervention has hidden costs everywhere. It was government intervention, through unusually low interest rates which caused the disparity in savings between the US and China... and then created a massive asset bubble. What the government must now do is ensure that structural damage is not done to the economy, for example through the TALF programs and by stress testing companies. Yes, the government has a role to play in building infrastructure. I would hardly classify upgrading road signs as 'infrastructure' however. The benefit just doesn't support the costs- we're talking something like $200,000 per job created by the stimulus package! That's the problem with shovel-ready projects. They just aren't economic infrastructure. They're like fiddling with the margins, and they're highly subject to pork-barrelling. And the policy which overwhelmingly works is deregulation. This is a policy which rejects as authoritarian the old command-and-control system of governance and recognises the efficiency of regulation which properly aligns incentives.

Whilst an economic stimulus in the short run will obviously boost the economy, we must ask at what cost. Economic theories now suggest that government intervention has hidden costs everywhere. It was government intervention, through unusually low interest rates which caused the disparity in savings between the US and China… and then created a massive asset bubble.

What the government must now do is ensure that structural damage is not done to the economy, for example through the TALF programs and by stress testing companies. Yes, the government has a role to play in building infrastructure. I would hardly classify upgrading road signs as ‘infrastructure’ however. The benefit just doesn’t support the costs– we’re talking something like $200,000 per job created by the stimulus package! That’s the problem with shovel-ready projects. They just aren’t economic infrastructure. They’re like fiddling with the margins, and they’re highly subject to pork-barrelling.

]]> By: Anonymous http://www.kewpid.net/2009/03/05/stop-it-or-youll-go-blind/comment-page-1/#comment-8581 Anonymous Sat, 23 May 2009 05:56:51 +0000 http://www.kewpid.net/?p=325#comment-8581 It seems are the great ideological battles have been fought, and won. Now we are just tinkering with the margins. We have a centre-left and centre-right party who are both equally pragmatic when it comes to policy. Where will the next battle of ideas of this generation be fought? It seems are the great ideological battles have been fought, and won. Now we are just tinkering with the margins. We have a centre-left and centre-right party who are both equally pragmatic when it comes to policy. Where will the next battle of ideas of this generation be fought?

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