Who Pays for Wasted Money?

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A friend of mine has a favorite story about a coworker — both in a career for highly intelligent professionals — who seemed sincerely convinced that the government could help the economy by building jet airliners and flying them into the ocean.  Obviously, that’s an extreme iteration of a common economic ignorance that one would hope would cause most people to pause and think, “No, wait, that can’t be right.”

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The anecdote came to mind while reading an AP story by Ricardo Alonso-Zaldivar, about the big ObamaCare increases facing those who receive no subsidies for their individual plans:

“We’re caught in the middle-class loophole of no help,” said Thornton, a hairdresser from Newark, Delaware. She said she’s currently paying about $740 a month in premiums, and expects her monthly bill next year to be around $1,000, a 35 percent increase.

“It’s like buying two new iPads a month and throwing them in the trash,” said Thornton, whose policy carries a deductible of $6,000.

The point that needs to be stated is that it doesn’t make the waste any more palatable when other people are receiving those two trash-destined iPads per month courtesy of the U.S. government.  The number of people throwing out metaphorical iPads for which they’ve paid may be small, but adding all of the subsidies up amounts to a lot of airplanes at the bottom of the ocean.

Of course (to be fair), all that money isn’t just producing garbage but is buying insurance against risk, albeit at an exorbitant cost with unjustifiable increases.  Acknowledging that the money is buying somethinghowever, only directs our attention back to the underlying injustice:  The government is just forcing some Americans to buy something for other Americans… and undermining our rights and increasing our overall risk in order to do so.

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  • Rhett Hardwick

    “who seemed sincerely convinced that the government could help the economy by building jet airliners and flying them into the ocean.”

    A fairly old theory. I commend “The Report from Iron Mountain on the Possibility and Desirability of Peace”. Written in the 60’s, or 70’s, “anonymously”. Although the author was later “discovered” and turned out to be a novelist. The thesis was that the “Space Race” and war were desirable because it allowed the government to pour huge sums into the economy, and then shoot it off into space so that the funds could never be recovered. But, money had been put in circulation,. I think this was before it was realized that the “Space Race” required the development of incredible amounts of technology, with earth bound uses,.

    Why not build schools and hospitals? Because the public would expect something. It is politically difficult to call it quits on a hospital and allow it to sit there as a shell. Same with schools. Exploration of space can be cranked up and down as desired,.

    I read it after the author was “discovered” and announced he intended it as a spoof on government spending. It was rather convincing to those who would accept the Keynesian School of Eonomics,.

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