I am often annoyed at the thought that in two decades no one will be able to deny global warming. All the oil companies will be fully diversified in renewable energy and we will finally be doing something about the problem. Better late than never. That doesn’t bother me. What bothers me is that all of the people who have made a living by claiming that global warming is a myth will just say, “Oops!” And that will be the end of it. If George Will is still alive, no one will think the less of him because of his cynical and relentless misinformation campaign. But at least we will move forward. The same cannot be said for many other things.
One of those things is the economy. Keynes famously said, “In the long run, we are all dead.” This was in response to economists who claimed that we didn’t need to worry about recessions because in the long run it would all work itself out. But there is a more pernicious aspect to this. It is absolutely true that if the government does nothing, a recession will eventually work itself out. In fact, if a government does everything it can to make things worse, a recession will still eventually work itself out. And in the end, the people in the government who made everything worse can say, “See! We were right!”
Dean Baker wrote a very brief article this morning with one of the best headlines I’ve ever seen, Doctors Report Assault Victim Feeling Better, Attribute Improvement to Vicious Beating. The article is in reference to a Financial Times report, Berlin and Brussels Credit Fiscal Discipline and Reform for Eurozone Recovery. So after years of the Eurozone harming its own economy, that economy is slowly on the mend. Where is the champagne?
And note that the news is not that great. In the second quarter of this year, the Eurozone grew by 1.2%—mostly on the backs of stronger growth in Germany and France. Regardless 1.2% is hardly a great growth rate. For example, the United States has been seeing a better growth rate and no one around here is cheering. What’s more, many people in Germany are cautioning that the future does not look so great as exports are slowing down.
I found one bit of news from the article very telling: “[Federation of German Industry chief executive Markus Kerber] said the greatest concern of the business lobby was the low level of investment in the German economy, with the share of investment in GDP falling from 20 per cent in 1999 to just 17 per cent in 2012.” The reason for all the government cut backs and raising of taxes is supposed to be to give the business community the “confidence” to invest. Clearly, the economy is recovering in other ways, despite not because of government policies.
So merrily we roll along. And in a few years (Hopefully!) when things are better, people will forget the suffering, and just remember that things are now better. Thus: the austerity policies must have created the good economy. But it certainly doesn’t help to have reporting like that from the Financial Times. That article does not make a single mention of the fact that the recovery might be occurring despite the policies. So it is just more myth making.
This is why Liberatianism is such an evil ideology. It matter not one whit that company X (say BP) may be out of business in 100 years because the market will eventually weed them out for their wanton destruction, negligent destruction and shameless bribery because thousands of people will be harmed and killed by their actions today.
@Grung_e_Gene – That’s one reason for sure! What I’ve most noticed with libertarians is that they always have this excuse for market failures: the market wasn’t free [i]enough![/i] If there is even a little government interference, they always have an out. And there will [i]always[/i] be some government interference, as they themselves require at least some.