George F. Will: Obama's Jobs Lowball
Three days after the president-elect announced in a radio address that he had directed his "economic team" to devise a plan "that will mean 2.5 million more jobs by January of 2011," he said at a news conference that he favored measures "that will help save or create 2.5 million jobs." To the extent that his ambition is clear, it is notably modest.
It is, however, unclear. How will anyone calculate the number of jobs "saved"? In what sense saved? Saved from what? Saved by what? By government action, such as agriculture subsidies or other corporate welfare? What about jobs lost because of those irrational uses of finite economic resources? Should jobs "saved" by, say, protectionist policies that interfere with free trade be balanced against jobs lost when export markets are lost to retaliatory protectionism?
In recent years, in normal conditions, the economy has "lost" tens of millions of jobs through capitalism's "creative destruction" (Joseph Schumpeter's phrase). It also has created a few million more than that, which is why the destruction is creative. Investor's Business Daily reports:
"Since Eisenhower's first term, the economy has created an average of 1.5 million new jobs each year. Since Reagan's first term, the average has been about 2.5 million a year. And Reagan, who inherited an economy as bad if not worse than the current one, saw 6.3 million new jobs created four years after he entered the White House."
Because the economy's job-creation is not quite as predictable as a solar eclipse, Obama, by promising 2.5 million jobs by 2011, is a bit more audacious than was Mark Twain's Connecticut Yankee, who astonished King Arthur's court by commanding an eclipse that he knew was due. Still, because scores of millions of today's jobs will exist two years from now, who will be able to dispute a presidential claim that administration policies "saved" some portion of them?...
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It is, however, unclear. How will anyone calculate the number of jobs "saved"? In what sense saved? Saved from what? Saved by what? By government action, such as agriculture subsidies or other corporate welfare? What about jobs lost because of those irrational uses of finite economic resources? Should jobs "saved" by, say, protectionist policies that interfere with free trade be balanced against jobs lost when export markets are lost to retaliatory protectionism?
In recent years, in normal conditions, the economy has "lost" tens of millions of jobs through capitalism's "creative destruction" (Joseph Schumpeter's phrase). It also has created a few million more than that, which is why the destruction is creative. Investor's Business Daily reports:
"Since Eisenhower's first term, the economy has created an average of 1.5 million new jobs each year. Since Reagan's first term, the average has been about 2.5 million a year. And Reagan, who inherited an economy as bad if not worse than the current one, saw 6.3 million new jobs created four years after he entered the White House."
Because the economy's job-creation is not quite as predictable as a solar eclipse, Obama, by promising 2.5 million jobs by 2011, is a bit more audacious than was Mark Twain's Connecticut Yankee, who astonished King Arthur's court by commanding an eclipse that he knew was due. Still, because scores of millions of today's jobs will exist two years from now, who will be able to dispute a presidential claim that administration policies "saved" some portion of them?...
In his wise book"Capitalism, Democracy & Ralph's Pretty Good Grocery," John Mueller, an Ohio State political scientist, notes that John Maynard Keynes's central theme, according to his biographer Robert Skidelsky, was that"the state is wise and the market is stupid." Mueller continues:"Working from that sort of perspective, India's top economists for a generation supported policies of regulation and central control that failed abysmally -- leading one of them to lament recently, 'India's misfortune was to have brilliant economists.'" Many of them were educated in Britain, by Keynes's followers. In America today, everyone agrees that the president-elect's economic team is composed of brilliant economists.