Parasitic government and the private sector

Jack Kelly:

President Barack Obama has little interest in, understanding of or affection for free markets, so he fails to understand that the fundamental relationship between government and the economy is that of parasite to host.

Some functions of government are absolutely essential to a free economy. We need a sound currency, civil courts to enforce contracts and to provide a peaceful means of dispute resolution, protection from criminals at home and enemies abroad. Other functions of government -- chiefly those such as Social Security, Medicare and unemployment insurance that involve the redistribution of wealth -- are supported by large majorities of Americans.

But though government can consume wealth and redistribute wealth, it can't create wealth. And unless wealth is created, there is nothing to consume or redistribute. That's why -- even when government is doing something we all agree must be done or most of us want to have it do -- government is a parasite. All it has is what it takes from the producers of wealth.

A healthy host can support a lot of parasites. A sickly host cannot. So whether you like big government or small, you should support what it takes to keep the private sector robust.

...

The stimulus failed chiefly because it was designed more to reward the president's political allies than to fight the recession. But the stimulus failed also because stimulus funds were used to preserve jobs state and local governments could no longer afford because of falling tax revenues. The private sector has borne more than 100 percent of the job loss because state and local governments have added 110,000 jobs, according to an August report by the Nelson A. Rockefeller Institute of Government.

A job's a job, right?

Not exactly. Preserving government jobs may deepen the recession because government workers are not engaged in wealth creation and their salaries must be paid by people in the private sector who are.

"Basically what you have is your producers in society losing their jobs and looking for work ... and they are likely to face tax increases going forward (to support government workers)," Brad DeHaven of the CATO Institute told The New York Times.

...

By attacking the private sector, the Democrats are at war with the people who pay taxes to support their government programs. Without them there are no taxes to pay for government jobs.

This is why a stimulus of tax cuts and cuts in government spending would boost the economy more.