Digging Ditches and Filling Them Does Not Create Jobs

I am always skeptical when I hear somebody talk about spending taxpayer dollars to create jobs. There are good kinds of spending to create jobs and bad kinds.

The good kind of spending to create jobs involves spending money that creates jobs for people where the results of their labor makes our country more productive and efficient and also helps to stimulate even more jobs. For example, spending money to make our nation's electrical grid more efficient, reliable, safer, etc. is something that will create jobs and also make our nation more productive thereby generating even more jobs. As one would expect, there are some things like this in our new stimulus bill.

The bad kind of spending to create jobs is doing things like paying people to dig a ditch and then paying them to fill it back up again. Sure it will employ a lot of ditch diggers, but the result of the labor does nothing to help the economy. It is essentially just politicians putting taxpayer dollars in the hands of certain people selected by politicians.

I know it sounds difficult to believe but here is how a politician might try and convince us to spend billions to dig ditches and fill them up.

The ditch diggers have been badly hurt by the economy and their jobs are being lost at record rate (insert sad story about an honest, hard working ditch digger who is suffering). This bill provides needed employment for people like one you just heard about. This bill will help keep America's ditch digging industry strong so we won't become dependent of foreign ditch diggers. This bill will have a positive ripple effect and create jobs for all the supporting industries like shovel, work boot, and uniform manufacturers.

Anyway, when you try and debate the politician they will tell you their plan will create jobs and help honest, hardworking ditch diggers. However, under their breath they may be whispering "the stock I own in the shovel company will go through the roof if this thing passes" or "I'll be able to count on the ditch digger vote if this thing passes". Granted, some politicians may not be motivated by votes or profit when they push for things, but it is still depressing if our politicians honestly believe that digging ditches and filling them will help our economy.

Problems with the $75 Billion Foreclosure Plan

The plan aims to reduce the number of foreclosures by spending taxpayer dollars and essentially giving money to selected people and banks at risk of foreclosures. The cost of this $75 billion plan is equivalent to $500 per US taxpayer (i.e. $75 billion divided by 150 million taxpayers).

Nobody likes people being forced out of their homes. However, it is also not good to reward people and banks that are overextended especially if it involves taking money away from people, taxpayers, who exercised more prudence.

Imagine a community of twenty or so hard working taxpayers where only one of the people is at risk of foreclosure. Imagine if the government forced each of the hard working taxpayers to walk over to their neighbor's house and each give $500 to the one person who is at risk of foreclosure. This is not the recipe for building a prosperous country. This is a recipe for more resentment, entitlement, and failure.

The root problem with a foreclosure is that somebody can't afford to live in the home they owe money on. Giving taxpayer dollars to people so they barely make payments is only going to drag the core problem on into the future.