Recently Josh Bivens penned an editorial for CNN asserting that, “It’s OK to add to debt to grow jobs.”
In the past three and a half years we have gone 5 trillion into new debt and we’ve lost 4 million jobs net. If we had simply used that 5 trillion to hire people directly we could have paid 20 million people 60 thousand dollars a year to each be employed for all 4 years Obama was in office. Instead, we have minus 800 thousand employees per trillion spent. (As Reagan said, “It would seem that someplace there must be some overhead.”)
Yet liberal academics such as Krugman and Bivens keep advocating Keynesian economic theories and asserting (paraphrase), “If only we had spent a little more money, then our theories would have all worked out…” Economists like this always have a reason to offer for why reality is wrong and why their theories are still correct. But we aren’t dealing with a theory here. Minus 800 thousand employees per trillion dollars of debt spending is reality.