by Mitch Kokai
Senior Political Analyst, John Locke Foundation
I took a camera to Times Square this week and asked people, “What creates jobs?” Most had no answer.
One said, “stimulus!” What? Government creates jobs? No!
I suppose it’s natural that people think government creates jobs because politicians always say that.
“We’ve now created more than 10 million,” said President Obama. But that just meant that he took office at the start of the recession, and finally job creation resumed.
He didn’t cause that. In fact, his taxes and complex regulation slowed job creation. …
… Now that government has lots of power, people look to it to create jobs. Communist countries had five-year plans. They didn’t work.
That’s because jobs come from government getting out of the way and letting employers produce goods.
Every new layer of regulations sounds nice — protecting the environment, providing more health care, forbidding discrimination against disabled people — but most rules do more harm than good.
Humans have needs and desires. Entrepreneurs see those needs as opportunity. They hire people not out of generosity or because government told them to — but because it’s profitable to employ people if they produce valuable goods.
If it’s not profitable, that means those people would be better employed doing something else. The prices customers are willing to pay and the wages workers accept are the best indication of which jobs can be done profitably and therefore ought to be done.