"Putting Money in the Hands of Unemployed..."

“Putting money in the hands of unemployed families... will create economic growth in America”

—Sen. Dick Durbin, D-Ill., November 20, 2008⁴²⁷

With this quote Durbin claims that confiscating the incomes and savings of those who are producing wealth for society and giving the money to others to consume will somehow create additional real goods and services. With this logic, politicians could say — and they do — that virtually anything creates wealth. In fact, politicians, and economists, often argue that having a hurricane destroy a city creates wealth (due to the spending involved in replacing all the wealth destroyed), that spending on unprofitable investments creates wealth (green energy, etc.), and that forcing citizens to purchase goods they don’t want to purchase — like the solar panels above — creates wealth.

Also in this article was the quote that “economists put the positive impact at $1.64 for every dollar spent on jobless benefits because the money helps sustain other jobs and restores consumer confidence.” These mathematical “economists” obviously believe the fallacious Keynesian notion that merely spending money to consume current goods without producing more goods to replace them somehow creates more goods (more wealth). They have astutely calculated that spending $1.00, while producing nothing, can create 64 cents of additional wealth. The truth is that it simply wastes a dollar and reduces our ability to produce increased economic growth.