Government leaders might think they can stimulate the economy by increasing taxpayer spending on ?stimulus? projects and other pet programs.
But economic growth really depends on private-sector investment. That?s why George Will?s observations in the latest Newsweek are important:
With Washington experiencing prolonged hyperkinesis, businesspeople are paralyzed by uncertainty about what the rules and costs of commerce are going to be. What would a cap-and-trade carbon-control regime do to energy costs? What will be the costs of whatever the Environmental Protection Agency decides to do on the basis of its “endangerment” finding that carbon dioxide is a pollutant? What will health-care and tax costs be? Money cannot be free forever, so someday interest rates are going to change. Starting from zero, the change will be adverse for many people.
In other words, Washington?s efforts to ?do something? have the (we can only hope) unintended effect of prompting investors and entrepreneurs to sit on their hands. Hence lingering double-digit unemployment.
