Question Details	Asked By	Asked On
God and bad economic policy?	Mathatmacoat	12/11/08
when journalists write of government's bold new stimulus package, they look no further than the visible benefits and ignore the hidden costs. If a bridge it to be built, construction workers and steelmakers will no doubt benefit But there are hidden costs. In this new eeconomic environment we see a rush to promote infrastructure projects what are the consequences? The price of steel and construction wages will be higher, discouraging private investment. If the funds are to be borrowed in the marketplace, that will restrict funds available for private investment. And what will happen to unemployment when the infrastructure is completed? The key to recovery is sustainable investment — not temporary jobs. A further example of this was a stimulus package given to the solar industry by the Australian government created a boom in the industry, but change of government and change of policy has seen the industry going from boom to bust, where will the skilled workers be when the government again decides to turn on the tap as part of their new stimulus package, working on another infrastructure project? Welfare Spending If you give a man a fish he will have a single meal. If you teach him how to fish, he will eat all his life. ~ Kuan-tzu, Taoist philospher (7th century BC). comments?
Answered By		Answered On
paraclete		12/11/08
With this sort of thinking no one would do anything, sort of paralysis by analysis. Yes I agree the Australian government's attempt to stimulate the economy by giving money to low income people is a deeply flawed ploy carried out without thinking but infrastructure projects take months and years to produce any impact. If governments want to stimulate the economy they could start by replacing their vehicle fleet immediately, replacing rolling stock on railways, replacing PC and equipment in schools and government offices, recruiting into the armed forces, subsidising housing construction for the low income rental market, stimulating local tourism and mandating that no organisation that takes government assistance or government contracts can cut back on employment

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