Comment 27217

By A Smith (anonymous) | Posted November 07, 2008 at 14:52:06

Ben, I understand my ideas seem pretty crazy, but here me out.

When the government taxes its citizens, it can either give that money back in useful goods and services, pay down debt/build a surplus, or waste some of it on things that don't directly help the people.

Obviously, wasting it on things that don't help the people is the last thing we want our government to do, or is it?

In the fifties, sixties and seventies, governments in North America (my numbers are from the US Bureau of Economic Analysis) funneled more of our money into the military then they do presently.

In comparison to today, the difference between tax receipts and useful government spending (infrastructure, health, education) was over 10% of GDP.

Curiously enough, as government wasted people's tax dollars on weapon systems, the economy spit out great paying jobs like no one's business.

Moreover, when this figure accelerated, thus indicating a widening between what government received in taxes and what it gave back in useful goods and services, the economy took off. When the number shrank, so did the economy.

How do we explain this? If government wastes precious tax dollars on building missiles, tanks, and ships how does that help the economy? I chalk it up to balance.

Everything in life is balanced by its opposite, so when government tries to be responsible with our tax dollars, it actually causes the opposite reaction to take place. That is the situation we are in today.

This notion, which is understandably illogical by normal standards of thinking, is borne out by the numbers.

If you want more proof, I will email you an excel file that shows a great correlation between government wastefulness and great economic growth for the average person.

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