The Folly of Bidenomics
this is not that hard
If you think like me you look at the Biden economic policy — Bidenomics — and wonder: what could go right? In The Wall Street Journal, Daniel Henninger lays it out:
Beyond the initial direct Covid payments to individuals and expanded unemployment benefits, the administration has poured money into infrastructure, veterans benefits, child care, food stamps, ObamaCare expansions, semiconductor production and about $400 billion on climate projects in the Inflation Reduction Act. Throw in some $127 billion in student-debt cancellation, by the administration’s own latest estimate.
What are we to think?
As the administration has argued, this was the most important outlay of federal spending since FDR.
To which I would say: Yeah. And therein lies the problem. The whole point about the New Deal and its pedal to the metal government spending was that it didn’t work, didn’t dig the US out of the Great Depression. That’s why, experts agree, the Dems took a shellacking in the 1938 midterms and why, some conspiracy theorist opine, FDR wanted to get into World War II.
So, I believe, we should assume that the current Bidenomics will not revive the economy. Because all it is doing is shoveling money at Democratic Party supporters and ruling-class enthusiasms.
President Biden says that he is building the economy from the bottom up and the middle out. Rather than the top down — you know, with hated trickle-down tax cuts.
But actually, Mr. President, politicians and economists and experts have No Idea how to build the economy, up, down, or sideways. All we can do to grow the economy is place our bets — whether in the job market, the product market, or the stock market and hope for the best. That goes for everyone, from lordly rulers down to the meanest welfare recipient.
In the economy, the only thing that matters is, when things go wrong, how do you know, and what do you do about it?
The worker and his job? If wages stagnate or the employer is laying people off: that means that things are going wrong. Better find another job. Nothing that force, otherwise known as a labor union, can do will make any difference.
The business and its products? If prices are going down and sales are going down and profits are going down it means that things are going wrong. Either change course or go out of business. Oh sure, government bailouts and/or subsidies might stave off the inevitable, but not forever.
The investor and his investments? If the market is going down then you are losing money and it’s already too late to do something about it. Sure, the government can stimulate the economy. But that really means nothing but inflation.
Whatabout the government and its programs? Oh dear, I’d rather not talk about that. Because the one thing for sure about government is that it doesn’t respond to market signals. Are its programs working? It has no idea. Pensions? Energy? Highways? Education? You tell me. Are its current enthusiasms going to help? Shut up and have faith, you science denier.
Actually, the whole point about how government works is that it commits us all to its wars, win or lose. The war could be a war against Nazis, or it could be a war against climate change. If it loses, then it wipes out the life and/or the savings of ordinary people. Probably the rulers will skedaddle to a safe place to enjoy their stash of ill-gotten gains, and the peasants will be left to starve.
I don’t know what it is going to take to get politicians and voters to understand that the government cannot successfully direct the economy, that nobody knows what is coming next, and that the only thing to do is to reduce the weight of government on the economy and hope for better times.
Where are the experts to teach us all about it? This isn’t that hard. Bidenomics is baloney, and we will all learn that sooner or later.