Related to my post “Is Taxation Theft“, I wanted to clear up and define something that gets misused so frequently that the average person may have missed it. You may often hear government officials talk about their various agencies and programs and how they are stimulating the economy. Some bureaucrat may point to the thousands of government workers they pay each month and how they ‘created’ those jobs.
If you’ve ever owned a successful business, then the steps you took before you started probably went something like this. You did some research to answer a few basic questions. Are your goods or services in demand? Are people willing to pay for them? How much? What would your costs look like? What would be the expected return on your investment? How would you finance your business? Would you have to take out a loan or do you have cash on hand that you’d invest in starting up? What are alternatives that you need to consider (opportunity costs) in which to spend your time and money instead of this business?
Finally, if you had a large enough plan and it proved to be successful, you might even have decided that you needed to hire employees. When you did, THAT WAS JOB CREATION. Your business model, investment, time and energy proved to add something valuable to the marketplace and thus created a job or jobs for people that did not exist previously. It is also completely funded by the revenues of business.
Now, take a look at how government jobs work. For the most part, they are funded by taxes which I have already established is a form of theft. They are largely not held accountable for any kind of return on those funds. There are some exceptions out there. The State Lottery, for example, may bring in millions of dollars to help fund education.
The point is that any job ‘created’ by the government which is funded by taxes is an oxymoron. This is simply taking stolen funds from taxpayers and appropriating them to special needs and projects that some central planner has deemed worthy. Nothing was ‘created’. Instead, something was stolen.
There are many different examples that you can search for online, but this clip where John Stossel explains the Broken Window Fallacy is crystal clear.
Don’t be fooled. Whenever you hear a government bureaucrat or lobbyist talk about needing more money or to remove more of your freedom in order to create jobs, they are talking about theft.