Reviews > Q&A

Slumps that go on and on

"Slumps that go on and on" Continued...

Issue: "A second chance," Nov. 20, 2010

Declaring business the enemy did not work very well in the 1930s. Why do we see this going on again? When you see government leaders really bullying business, you know that government's economic policy is failing. They get angry and they get desperate.

So to reduce unemployment, government should . . . Mostly get out of the way. Employers are very concerned about healthcare legislation because they know that it will be a mandate upon them to pay more for healthcare, but they do not know the particular rules yet. They are concerned about unemployment insurance premiums: When unemployment insurance goes for 99 weeks, what the company must pay to support them will be higher.

How did New Deal government expansion affect charities? There was plenty of charity in the United States before the New Deal, and there were plenty of public works, mostly at the state level. This was essentially squeezed out by the New Dealers stepping in and hogging that space.

In a recent column you advocated a humble economic policy. What is that? The reality is there's a lot we do not know about economics. All of us don't know. To assume that a stimulus will always work is a big assumption. Given that we are not sure we know, maybe we should do less. There is a particular arrogance currently in Keynesian economics, which you see when economists say consumer spending drives the economy. Economists do not know that. Maybe the majority of people who got a doctorate in economics between 1968 and 1990 think that, but centuries before them, people who studied economics did not think that-maybe for a longer period. This assumption that Keynesianism is the only way is absurd.

You like lower taxes . . . I'm always for lower taxes because lower taxes make people want to do things. Less burden, more fun, and economics is about people wanting to have fun. Growth is fun for people in the marketplace.

If the jobless recovery continues, what will be the structural consequences? Maybe the economy changes and it is easier for everyone to be a freelancer. Being a freelancer can be worse than being an employee, or it can be more lucrative, more entrepreneurial. All things being equal, this country wants to grow. It is not a loser country. It is a winner country. In terms of the mentality of the country, it is still an immigrant country. People are here because they tried hard, or their parents tried hard, or their grandparents tried hard.
To hear Marvin Olasky's complete interview with Amity Shlaes, click here.

Marvin Olasky
Marvin Olasky

Marvin is editor in chief of WORLD News Group and the author of more than 20 books, including The Tragedy of American Compassion. Follow Marvin on Twitter @MarvinOlasky.

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