Monday, February 16, 2009

Spending programs

Economist Robert H. Frank in today's New York Times:
Bizarrely, however, some Congressional critics have denounced the administration’s stimulus proposals as “mere spending programs.” Of course they’re spending programs! More spending is exactly what we need. The imperative is to get this legislation passed and get the spending started right away.
This completely misses the point and I can't believe that Frank actually believes this. The criticism is not that money is being spent, it is that it is being mis-spent and simply spent for the sake of spending. For example, we could have a program that simply pays people to dig holes and then fill them back up. Would Frank endorse that? After all, money would be spent, which is the point right? Does Frank believe that all forms of spending are equal?

I doubt it. Such spending does nothing to increase wealth or make the country better, which is a criticism that could probably be leveled at much of what's in the stimulus package. Simply shoveling money out the door willy-nilly can't be considered wise policy.

It's stuff like this that makes you remember that economics (particularly macro) is not a true science and too often a forum for charlatans to advance their vision of society under the guise of rigorous scholarship.

Update: Frank has a history of writing such nonsense.

1 comment:

Anonymous said...

If Robert Frank can call himself an economist, then can my dog also be called an economist? They both seem to have the same level of understanding. Although my dog waits until he is hungry to eat the food in his bowl; while Mr. Frank would probable encourage my dog to eat it right away and then beg for more.