Thingamajigonomics

Thingamajigonomics
by John Hayward
June 4, 2012

Killing some time on the campaign trail in between the six fundraisers he held on Friday, President Obama followed his standard procedure for using the latest horrible chapter of his three years of grinding unemployment to insist that no one can oppose his policies any more.

Speaking to a group of Honeywell employees, Obama made headlines with the utter “Beavis and Butthead” lameness of his rhetoric, as he tried to explain why his latest plan to stuff government cash into certain people’s pockets will finally stimulate the economy.

“There are some folks here who could use $3,000 a year,” said the President. “If you got $3000 a year extra, that helps you pay down your credit cards, that helps you go out and buy some things that your family needs, which is good for business. Maybe some of you will be replacing some thingamajig for the furnace.”

A tidal wave of derision swept across the Internet, as Americans reeling from the horrendous May unemployment report decided they could at least milk some entertainment from the remaining five months of the Obama presidency. A Twitter hashtag for mocking Obama by dropping the word “thingamajig” into famous historical quotes swiftly became one of the hottest topics in the world.

Somehow we’ve grown accustomed to the unseemly spectacle of the President of our constitutional republic “governing” by promising to toss bags of cash to worthy peasants, not to mention favored billionaires. Obama’s foray into thingamjigonomics is also a fairly concise demonstration of his “Keynes For Dummies” worldview. He really does think economic growth works something like this: Benevolent government gives people money; people buy stuff with their loot; jobs are created to meet this demand.

It’s appalling, but not surprising, to hear the latest demonstration that Barack Obama still has absolutely no idea how the private sector works, three and a half years into his term of office. Healthy job creation occurs in response to opportunity, not artificially stimulated consumer demand.

Obama’s trillion-dollar-plus “stimulus” vanished into the ether, leaving unemployment worse than he claimed it would be without the stimulus spending, because his genius central planners don’t understand the dangers of pumping the economy full of false data. Also, a great deal of that money was used to prop up state government payrolls, and finance other activities that have nothing to do with stimulating the private sector. The result is not “job growth,” because the jobs cost millions of taxpayer dollars apiece to create, and they vanish after the tide of stimulus cash recedes.

The act of spending money is not the sole measure of economic health. What we do to earn the money is important too, because it creates value, and establishes long-term opportunity. The labor provided in exchange for competitive wages is valuable. Growing businesses with stable labor forces create opportunities for other businesses. Good jobs are long-term relationships, and businesses only want to establish such relationships in an atmosphere of confidence and voluntary, long-term demand.

If there’s one thing we’ve learned from the failure of Obama’s economic policy, it’s that government cannot create opportunity through fiat. Obama spent countless billions attempting to conjure a market for his “green energy” junk into existence, but Americans want cheap and reliable sources of power, not solar panels and windmills. Slipping a few extra bucks into paychecks by raiding Social Security did absolutely nothing to stimulate job creation. Neither did extending unemployment benefits, which has the added drawback of reducing the pressure upon unemployed persons to seek jobs… which is another way of saying it interferes with their ability to detect and pursue opportunity.

Any Big Government program that reduces the size of the private sector, makes it more difficult for people to voluntarily discover profitable investments, and increases the cost of exploiting opportunities when they arise is bound to produce Obama’s low-growth, high-unemployment quicksand. American business crouches fearfully before the towering national debt, ObamaCare, and Taxmageddon, never knowing who Obama’s regulators will decide to “crucify” next, as one of his EPA administrators famously put it.

The idea that tossing select groups of citizens a little extra spending money will counteract all of that uncertainty is ludicrous. Obamanomics is deficit spending to subsidize the purchase of heavily regulated thingamajigs, with government swooping in to seize the profits… crushing any thingamajig manufacturers foolish enough to resist, while bailing out politically-connected whatchamacallit moguls who can’t find a way to compete.
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To read another article by John Hayward, click here.