The Motley Fool Discussion Boards

Previous Page

Investment Analysis Clubs / Macro Economic Trends and Risks


Subject:  Re: Here's your chance: Balance the Fed budget Date:  1/2/2007  3:10 PM
Author:  qazulight Number:  200164 of 603841


I detect with in your reasoning an unstated belief that government spending adds zero to the wealth of the nation.

I dispute that assumption.

I can point to the first road built between New York and Washington. It became a trade route and increased the GDP of the young nation.

The Transcontinental railroad was the second. It was funded through bonds by the government. It increased wealth in ways that the builders never envisioned. (Nothing Like it in the World by Steven Ambrose)

In the 1990's I found bright young computer programmers from Manila working in Hong Kong as drivers. They couldn't make a living in Manila because the power would not stay on long enough for a business to operate. It is apparent to me, that quality regulation of the electric industry there would have more than paid for itself in income taxes generated by businesses that could operate.

I have noted before that I came across a place here in Texas that treats mentally ill people. It is for the indigent and is supported by state and local taxes. This can show an immediate positive economic impact, simply because it is cheaper to treat the mentally ill than to incarcerate them.

Although many government spending programs are just a waste of money, many are not. Furthermore I can go to the CAPS board and in just a few minutes find a 100 million dollars worth of companies that will fail and use up all of their capitalization doing it. Waste is inevitable, but it is tolerable and necessary so that the useful things can be built.


Copyright 1996-2020 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us