The Case Of The Missing Production

clipped from www.dailymarkets.com Washington is telling us that our problems result from a lack of consumer spending. Therefore, the solution is for government spending to pick up the slack. However, if Americans are too broke to spend, then how can our government spend for us? Printing money is merely taxation in another form. Rather than robbing citizens of their money, government robs their money of its purchasing power. If the government simply prints money and doles it out, we will not be able to buy more stuff; we will simply pay higher prices. The only way to buy more is to produce more. It is production that creates purchasing power, not the printing press! To solve our problems we must first come to terms with their source. That is what the voices from abroad are telling us. We borrowed and spent ourselves to the brink of bankruptcy, and now we must save and produce ourselves back to prosperity. Of course, this simple solution is rejected by Keynesian economists who insist that we must keep spending.

Du'oh.