Saturday, June 14, 2008

The Government Wrecks the Economy

So what does Washington do? In an act of incredible stupidity, Congress has passed an extension of unemployment benefits. The old rule remains true: if you subsidize something, you get more of it. So this will give us more unemployment. No question about that. It will thereby worsen and prolong the problem.
It takes only a second of economic logic to see why. In a recessionary environment, we need freer, not more socialized, labor markets. Business needs to be able to hire workers at lower prices. You don’t want to increase the cost of hiring; you want to reduce it, especially with unemployment rising. Instead, Congress loots the workers of this country in order to prevent people from entering the job market.

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