If you have been reading this rant, you know I am deeply disturbed because this administration repeats its mistakes over and over again. Reading today's New York Times Business Section, I had a revelation. The problem is that when reality conflicts with economic theory, the economists stick with the theory and discard the reality. I know that sounds absurd to reasonable people, but when you spend two decades in academe you understand there is no limit to stupidity.
Here is what Christina Romer (remember her? Obama's first Chief Economist) says about Obama's jobs bill.
"Then there’s the $245 billion in tax cuts. That money doesn’t disappear. It goes to households that can spend it on goods and services, and to businesses that can spend it on research and development and new machines. That added consumption and investment is a benefit, along with the jobs created."
Yes, consumers could spend the money. But the facts are that they don't. Three times, starting with the $500 check George W. sent you, economists have said that tax cuts would stimulate the economy. But they don't. Sensible people use the money to pay down credit card debt and/or save it for the rainy day coming tomorrow.
Yes, businesses could spend it on R&D. But the facts are that they don't. Right now, U.S. businesses have more CASH on hand than at in any time in recorded history. They are not spending it on R&D because they don't have customers demanding new and improved products. All they are going to do is add the tax cuts to their cash stash.
Now I don't doubt Christina is nice person. She is just plain stupid because she refuses to recognize that her theories are all crap. And that goes for 99.9% of all economists.
I hate to bring this up again, but remember how Einstein defined insanity? "Repeating the same behavior over and over again and expecting a different outcome."
So there you have it. Economists are running the government and they are all demonstrably insane. Ergo, our government is being run by insane people.