Say’s Law

Posted by PITHOCRATES - September 2nd, 2013

Economics 101

(originally published August 6, 2012)

Keynesians believe if you Build Demand Economic Activity will Follow

People hate catching a common cold.  And have long wanted a cure for the common cold.  For a long time.  For hundreds of years.  But no one had ever filled this incredible demand.  All this time doctors and scientists still haven’t been able to figure that one out.  Despite knowing with that incredible demand, and our patent rights, whoever does figure that one out will become richer than Bill Gates.  Which is quite the incentive for figuring out the ingredients to make one little pill.  So why hasn’t anyone found the cure for the common cold?

There are many reasons.  But let’s just ignore them.  Like a Keynesian economist ignores a lot of things in their economic formulas.  In fact, let’s try and enter the head of some Keynesian economists.  And have them answer the question why there isn’t a cure for the common cold.  Based on their economic analysis you might hear them say that we have a cure for the common cold.  Because a high demand makes anything happen.  Or you might hear them say we don’t have a cure because enough people haven’t caught a cold yet.  And that we need to get more people to catch colds so we increase the demand for a cure.

Keynesians believe if you build demand economic activity will follow.  Like in that movie where they build a baseball diamond in a cornfield and those dead baseball players come back to play on it.  So Keynesians believe in government spending.  And love stimulus spending.  As well as taxing people to give their money to other people to spend.  Because having money to spend stimulates demand.  Consumers will consume things.  And increase consumption.  So suppliers will bring more things to market.  And create more jobs to meet that consumption demand.  Unless people save that money.  Which is something Keynesians hate.  Because saving reduces consumption.   Which is about the worst thing you could do in the universe of Keynesian economics.  Save money.  For in that universe spending trumps saving.  In fact, spending trumps everything.  No matter how you create that spending.  Keynesians actually believe taxing people so they can pay other people to dig a ditch and then fill that ditch back in stimulates economic activity.  Because these ditch diggers/fillers will take their paycheck and spend it.

Today People wait Anxiously for the next Apple Release to Learn what the Next Thing is that they Must Have

Of course there is a problem with this economic theory.  When you take money away from others they haven’t created new economic activity.  They just transferred that spending to someone else.  The people who earned that money spend less while the people who didn’t earn it spend more.  It’s a wash.  Some spending goes down.  While some spending goes up.  Actually there is a net loss in economic activity.  Because that money has to pass through government hands.  Where some of it sticks.  Because bureaucrats have to eat, too.  So the people receiving this money don’t receive as much as what was taxed away.  So Keynesian stimulus doesn’t really stimulate.  It actually reduces economic activity from what it might have been.  Because of the government’s cut.

And it gets worse.  Because this consumption demand doesn’t really create jobs.  We get nothing new out of it.  What do people demand?  Things they see.  Things they know about.  For it is hard to demand something that doesn’t exist.  You see a commercial for another incredible Apple product and you want it.  Thanks to some great advertising that explained why you must have it.  In other words, when you give money to people all they will do is buy things they’ve always wanted.  Things that already exist.  Old stuff.  It’s sort of the chicken and the egg thing.  Which came first?  Wanting something?  Or the thing that people want?

Raising taxes on Apple to create a more egalitarian society by redistributing their wealth will let people buy more of the old stuff.  But it won’t help Apple create more new things to bring to market.  Things we don’t even know about yet.  If we tax them so much that it leaves little left for them to invest in research and development how are they going to develop new things?  Things we don’t even know about yet?  Things that we will learn that we must have?  Once upon a time no one was asking for portable cassette players.  Then Sony came out with the Walkman.  And everyone had to have one.  Once upon a time there were no MP3 players.  No smartphones.  No tablet computers.  Now people must have these things.  After their manufacturers told us why we must have them.  Today people wait anxiously for the next Apple release to learn what the next thing is that they must have.

Say’s Law states that Supply Creates Demand

Supply leads demand.  We can’t ask for the unknown.  We can only ask for what the market has shown us.  Which is why Keynesian economics doesn’t work.  Because focusing on demand doesn’t work.  Giving people money to spend doesn’t stimulate creativity in the market place.  Because that money was taxed out of the market place.   Reducing profits.  Leaving less for businesses to invest into research and development.  And reducing their incentive to take big risks to bring the next big thing to market.  Like a phone you can talk to and ask questions.  Again something no one was demanding.  But now it’s something everyone wants.

Jean-Baptiste Say (1767–1832) was a French economist.  Another brilliant French mind that contributed to the Enlightenment.  And helped advance Western Civilization.  He observed how supply led demand.  Understood production was key in the economy.  He knew to create economic activity you had to focus on the producers.  Not the consumers.  Because if we encourage brilliant minds to bring brilliant things to market the demand will follow.  As history has shown.  And continues to show.  Every time a high-tech company brings something new to market that they have to explain to us before we realize we must have it.  Or said in another way, supply creates demand.  A little law of economics that we call Say’s law.

If Keynesian economics worked no one would have to have a job.  The government could print money for everyone.  And the people could take their government dollars and consume whatever was in the market place.  Which, of course, would be pretty sparse if no one worked.  If there were no Steve Jobs out there thinking of brilliant things to bring to market.  Because supply creates demand.  Demand doesn’t create supply.  For fists full of money won’t stimulate any economic activity if there is nothing to buy.  So using Keynesian stimulus as a cure for a recession is about as effective as someone’s homemade cure for the common cold.  You take the homemade concoction and in a week or two it cures you.  Of course, the cold just ran its course.  Which is how recessions end.  After they run their course.  Which can be a short course if there isn’t too much Keynesian intervention.

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Keynesian Multiplier

Posted by PITHOCRATES - September 3rd, 2012

Economics 101

At the Heart of Keynesian Stimulus Spending is the Keynesian Multiplier

Key to Keynesian economics is spending.  That’s the reason why governments everywhere embrace it.  Because Keynesian economics say government MUST spend money.  And that’s the kind of economics politicians like.  “I must spend?  Well, okay.  If you say so.  Forgive me, my constituents, for spending money I don’t have.  But it’s not me.  It’s our Keynesian economists saying we must spend.  And they’re smart.  Real smart.  They even have Ivy League degrees.  So who are we to question them?”

And it’s not just any kind of spending.  Well, actually, it is.  There’s nothing special about it.  You could pass a trillion dollar stimulus bill to pay people to dig holes with a shovel.  Fill them back in with the dirt they just shoveled out.  And then repeat.  Again and again.  Accomplishing nothing beneficial with these efforts.  But a Keynesian economist will approve of this spending and call it a good thing.  Why?  Because of trickle-down economics.  But of the Keynesian kind.

At the heart of Keynesian stimulus spending is the Keynesian multiplier.  That’s the ‘trickle down’ part.  But before we get to that we must discuss one other thing.  Savings.  Keynesians hate it.  They call money that leaks out of the economy into savings accounts wasted money.  Just as if you flushed it down the toilet.  This brings up another Keynesian concept.  The marginal propensity to consume (MPC).  Note the word ‘consume’.  This is what all that government spending is about.  Consumption.  Consumer spending.  Which is why Keynesians hate savings.  Because if people save their money they’re not spending it.  And not creating economic activity.

Politicians prefer Government Spending over Tax Cuts because People may Save Part of a Tax Cut

Now back to the multiplier.  When people receive money they do two things.  They save some of it.  And spend what they don’t save.  This is where the MPC comes in.  An MPC 0f 80% means that people will spend 80% of an amount of money they receive (paycheck, government benefit, etc.) and save 20% of it.  So they use 80% of that money to generate economic activity.  By spending it.  But it doesn’t end there.  Because what they spend other people receive as money.  And these people then save some of it.  And spend what they don’t save.  And so on.  At a MPC of 80% if a person receives $100 they will spend $80 and save $20.  Those who receive that $80 will spend $64 and save $16.  Those who receive $64 will spend $51.20 and save $12.80.  And on and on until people are only spending pennies.  In the end that original $100 will create a total of $500 in new economic activity.  Or five times the original amount.  So the Keynesian multiplier is five.  Or, mathematically, 1/(1-MPC) where MPC = 0.80.

Think of the multiplier as a pyramid of champagne glasses at a wedding.  As you pour champagne in the top glass it overflows into the next layer of glasses down.  When these glasses fill they overflow into the next layer of glasses below them.  The multiplier is kind of like that.  Starting by pouring into one glass.  By the time the champagne bottle is empty champagne fills many glasses.  And spilt champagne represents savings.  Or leakage.  That’s how the multiplier works.  Trickle down.  And the less champagne spilled the more champagne fills glasses.  As shown by the multiplier formula.  The larger the MPC is (as in the more people spend) the larger the multiplier.  In fact if they spent all of their money (an MPC = 1) the formula reduces to 1/0.  And what happens when you divide by zero?  You get infinity.  That’s right, according to the Keynesian multiplier equation if everybody spent all of their money and saved none there would be an infinite amount of economic activity.

In the Keynesian world it doesn’t matter what the money is spent on as long as it’s spent.  Even digging worthless holes is good enough to make this miracle of economic activity out of nothing work.  That’s why their advice is always for the government to tax, borrow or print money to spend.  Because spending is good.  And they prefer government spending over tax cuts to stimulate private spending.  Why?  When the government spends money that top champagne glass will have an MPC of 1.  The government will spend it all.  Less the administrative costs, of course.  Whereas an equivalent amount of money given to the people via a tax cut (letting them keep more of their earnings to spend) will not have an MPC of 1.  Because these people may do something foolish like save their money.  Or pay down debt.  Which is leakage.  Leakage reduces the multiplier.  And a lower multiplier reduces economic activity.

Governments Embrace Keynesian economics because it tells them to Always Spend More Money

It all seems too good to be true.  And there’s a reason for that.  Because it IS too good to be true.  And the proof is in the pudding.  The Seventies was the decade of unrestrained Keynesian economics.  And it didn’t work.  They spent like there was no tomorrow in the Seventies.  But all that Keynesian spending failed to pull the economy out of recession.  All it did was create high inflation.  So there was high unemployment AND high inflation.  Something that was impossible in the Keynesian universe.  But it happened.  Why?  Because they make a lot of assumptions to make their formulas work.  Like that MPC.  And their war on savings.  Their thinking is flawed.  Because savings ARE spending.  Someone’s savings is someone else’s investment.  And investments are spending.  Ever see It’s a Wonderful Life when the people were asking for their deposits back?  The savings and loans had some money.  But they didn’t have everyone’s money.  Then George Bailey (Jimmy Stewart) told his depositors where their money was.  And he ran down a list of all the new houses their savings built.  Thanks to their loans to those new homeowners.  Building those houses generated a lot of economic activity.  So savings are good.  They’re not leakage.  They cause real economic activity.

Let’s return to that pyramid of champagne glasses.  Let’s say it takes 3 bottles of champagne to fill all the glasses in the pyramid.  If you pour the champagne back from the glasses into the bottles you will not have three full bottles of champagne.  Because of all that spillage.  Or leakage.  This is the same with Keynesian stimulus spending.  Stimulus money has to come from somewhere.  Whether government raises it with taxes, borrows it or prints it.  And like that champagne it just moves from one place in the economy to another.  With no net change in economic activity.  Higher taxes mean we have less money to spend.  If they borrow money they reduce private investment.  Because investors are buying government bonds instead if investing in businesses or entrepreneurs.  If they print money they cause inflation.  Which makes our money worth less and prices higher.  Which buys us less after the inflation than before it.  So whatever government spends there is a corresponding reduction in economic activity elsewhere in the economy.  Worse, when the government redistributes this money there is leakage.  Like the spillage of champagne.  For administrative costs.  Because politicians and government bureaucrats don’t work for free.

Printing money is especially harmful to the economy.  For it can cause a short-term boom in economic activity.  But by the time that new money works its way through the economy prices begin to rise.  Raising the cost of businesses.  Who have to raise their prices.  As they do their sales fall.  And they have to lay people off.  So the Keynesian stimulus spending to end a recession results in a new recession.  Which tends to be more painful than the first one.  So eventually a recessionary bust follows the artificial boom in economic activity.  Which brings those artificially high prices back down to normal market prices.  The greater the stimulus spending the higher those prices go.  The farther they have to fall.  And the more painful the recession.  Making the multiplier nothing but smoke and mirrors.  But governments still embrace Keynesian economics.  Because it is the only economic system that tells them to spend more money.  And they are always looking for something to justify more spending.

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Say’s Law

Posted by PITHOCRATES - August 6th, 2012

Economics 101

Keynesians believe if you Build Demand Economic Activity will Follow

People hate catching a common cold.  And have long wanted a cure for the common cold.  For a long time.  For hundreds of years.  But no one had ever filled this incredible demand.  All this time doctors and scientists still haven’t been able to figure that one out.  Despite knowing with that incredible demand, and our patent rights, whoever does figure that one out will become richer than Bill Gates.  Which is quite the incentive for figuring out the ingredients to make one little pill.  So why hasn’t anyone found the cure for the common cold?

There are many reasons.  But let’s just ignore them.  Like a Keynesian economist ignores a lot of things in their economic formulas.  In fact, let’s try and enter the head of some Keynesian economists.  And have them answer the question why there isn’t a cure for the common cold.  Based on their economic analysis you might hear them say that we have a cure for the common cold.  Because a high demand makes anything happen.  Or you might hear them say we don’t have a cure because enough people haven’t caught a cold yet.  And that we need to get more people to catch colds so we increase the demand for a cure.

Keynesians believe if you build demand economic activity will follow.  Like in that movie where they build a baseball diamond in a cornfield and those dead baseball players come back to play on it.  So Keynesians believe in government spending.  And love stimulus spending.  As well as taxing people to give their money to other people to spend.  Because having money to spend stimulates demand.  Consumers will consume things.  And increase consumption.  So suppliers will bring more things to market.  And create more jobs to meet that consumption demand.  Unless people save that money.  Which is something Keynesians hate.  Because saving reduces consumption.   Which is about the worst thing you could do in the universe of Keynesian economics.  Save money.  For in that universe spending trumps saving.  In fact, spending trumps everything.  No matter how you create that spending.  Keynesians actually believe taxing people so they can pay other people to dig a ditch and then fill that ditch back in stimulates economic activity.  Because these ditch diggers/fillers will take their paycheck and spend it.

Today People wait Anxiously for the next Apple Release to Learn what the Next Thing is that they Must Have

Of course there is a problem with this economic theory.  When you take money away from others they haven’t created new economic activity.  They just transferred that spending to someone else.  The people who earned that money spend less while the people who didn’t earn it spend more.  It’s a wash.  Some spending goes down.  While some spending goes up.  Actually there is a net loss in economic activity.  Because that money has to pass through government hands.  Where some of it sticks.  Because bureaucrats have to eat, too.  So the people receiving this money don’t receive as much as what was taxed away.  So Keynesian stimulus doesn’t really stimulate.  It actually reduces economic activity from what it might have been.  Because of the government’s cut.

And it gets worse.  Because this consumption demand doesn’t really create jobs.  We get nothing new out of it.  What do people demand?  Things they see.  Things they know about.  For it is hard to demand something that doesn’t exist.  You see a commercial for another incredible Apple product and you want it.  Thanks to some great advertising that explained why you must have it.  In other words, when you give money to people all they will do is buy things they’ve always wanted.  Things that already exist.  Old stuff.  It’s sort of the chicken and the egg thing.  Which came first?  Wanting something?  Or the thing that people want?

Raising taxes on Apple to create a more egalitarian society by redistributing their wealth will let people buy more of the old stuff.  But it won’t help Apple create more new things to bring to market.  Things we don’t even know about yet.  If we tax them so much that it leaves little left for them to invest in research and development how are they going to develop new things?  Things we don’t even know about yet?  Things that we will learn that we must have?  Once upon a time no one was asking for portable cassette players.  Then Sony came out with the Walkman.  And everyone had to have one.  Once upon a time there were no MP3 players.  No smartphones.  No tablet computers.  Now people must have these things.  After their manufacturers told us why we must have them.  Today people wait anxiously for the next Apple release to learn what the next thing is that they must have.

Say’s Law states that Supply Creates Demand

Supply leads demand.  We can’t ask for the unknown.  We can only ask for what the market has shown us.  Which is why Keynesian economics doesn’t work.  Because focusing on demand doesn’t work.  Giving people money to spend doesn’t stimulate creativity in the market place.  Because that money was taxed out of the market place.   Reducing profits.  Leaving less for businesses to invest into research and development.  And reducing their incentive to take big risks to bring the next big thing to market.  Like a phone you can talk to and ask questions.  Again something no one was demanding.  But now it’s something everyone wants.

Jean-Baptiste Say (1767–1832) was a French economist.  Another brilliant French mind that contributed to the Enlightenment.  And helped advance Western Civilization.  He observed how supply led demand.  Understood production was key in the economy.  He knew to create economic activity you had to focus on the producers.  Not the consumers.  Because if we encourage brilliant minds to bring brilliant things to market the demand will follow.  As history has shown.  And continues to show.  Every time a high-tech company brings something new to market that they have to explain to us before we realize we must have it.  Or said in another way, supply creates demand.  A little law of economics that we call Say’s law.

If Keynesian economics worked no one would have to have a job.  The government could print money for everyone.  And the people could take their government dollars and consume whatever was in the market place.  Which, of course, would be pretty sparse if no one worked.  If there were no Steve Jobs out there thinking of brilliant things to bring to market.  Because supply creates demand.  Demand doesn’t create supply.  For fists full of money won’t stimulate any economic activity if there is nothing to buy.  So using Keynesian stimulus as a cure for a recession is about as effective as someone’s homemade cure for the common cold.  You take the homemade concoction and in a week or two it cures you.  Of course, the cold just ran its course.  Which is how recessions end.  After they run their course.  Which can be a short course if there isn’t too much Keynesian intervention.

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Keynesians turn to Alien Invasions to Fix the Economy and to Stop Global Warming

Posted by PITHOCRATES - August 19th, 2011

Paying them to Dig Ditches, then Paying them to fill them back In

Leave it to a Keynesian to find the silver lining in a war of annihilation (see The Dimlight Zone posted 8/17/2011 on Investor’s Business Daily).

“If we discovered that space aliens were planning to attack,” Krugman told CNN’s Fareed Zakaria on Sunday, “and we needed a massive buildup to counter the space alien threat, and inflation and budget deficits took secondary place to that, this slump would be over in 18 months.”

Where did Krugman get his idea for “Up-in-the-Sky-Side Economics”? He told Zakaria, “There was a ‘Twilight Zone’ episode like this in which scientists fake an alien threat in order to achieve world peace. Well, this time we don’t need it; we need it in order to get some fiscal stimulus.”

And Paul Krugman won the Nobel Memorial Prize in Economics.  Not for his theory on space alien threats but for something about New Trade Theory and New Economic Geography

He’s Ivy League.  A Keynesian economist of the first order.  And an Orwellian socialist, apparently.  For in Orwell‘s Nineteen Eighty-Four, that was a key party tenet.  Perpetual war.  To unite the people against the common enemy (which often changed if one of their two possible enemies was losing too badly).  And to consume the products of state labor.  To provide permanent employment for the people.  (Sort of like paying them to dig ditches, then paying them to fill them back in.)  Building the things of war.  While they lived in desperate privation of the necessities of life.  A dark existence indeed.  But they kept the people occupied.  And obedient.

World War gave the U.S. a strong Export Market During and After the War

Being in favor of war spending is a bit strange.  Considering the Left’s vehement opposition to the Iraq Way, the War in Afghanistan, the Libyan War, the Vietnam War, etc.  All of these were quite costly.  And required enormous war production.  Creating near-perpetual jobs for people in the war economy.  There was a whole lot of deficit spending going on.  Just like you’d think an Orwellian socialist would like.  But no. 

Contrary to Keynesian belief, these wars did not stimulate the economy.  They were in effect paying people to dig ditches and then having them fill them back in.  Just moving money around in the economy.  Not creating anything new.  Unlike the war he refers to in that article.  The good war.  World War II

World War II was a different kind of war.  It was a world war.  Much like World War I.  Where the world’s economies were left in ashes.  Unlike America.  Who was unscathed during these wars.  Was ready and able to rebuild the world after these wars.  And feed it, too.  So not only did we have a strong export market during the war (we were the Arsenal of Democracy), we had an even stronger export market after the war. 

That’s what makes a war profitable.  When someone else pays for it.  Which is why the previously mentioned wars did not stimulate economic activity.  The United States paid for them.  Not other people.  It was just moving money around in the economy.  Not creating anything new.  Just digging ditches.  And filling them back in.

Before acting to Save the World a Keynesian would Consider its Impact on the Next Election First

Besides, do we really want Keynesians fighting our wars?  For they are more concerned in winning political battles than military ones.  No matter the costs.  Whether it threatens the fiscal solvency of the country.  Or military strategy (see Bad luck? Bad faith? by Charles Krauthammer posted 8/18/2011 on The Washington Post).

The charge [wishing to see America fail for their own political gain] is not just ugly. It’s laughable. All but five Republican members of the House — moderate, establishment, Tea Party, freshmen alike — voted for a budget containing radical Medicare reform knowing it could very well end many of their careers. Democrats launched gleefully into Mediscare attacks, hardly believing their luck that Republicans should have proposed something so politically risky in pursuit of fiscal solvency. Yet Obama accuses Republicans of acting for nothing but partisan advantage.

This from a man who has cagily refused to propose a single structural reform to entitlements in his three years in office. A man who ordered that the Afghan surge be unwound by September 2012, a date that makes no military sense (it occurs during the fighting season), a date not recommended by his commanders, a date whose sole purpose is to give Obama political relief on the eve of the 2012 election. And Obama dares accuse others of placing politics above country?

Let’s just hope that when the aliens attack we don’t have Keynesians in power.  For with them it’s about the money and the power.  And political expediency.  Who would, in the face of an alien evasion, dither about what action would benefit them most in the next election before acting to save the world.

Global Warming bringing the Final Frontier to Us?

Paul Krugman isn’t the only one thinking about alien invasions.  Climate scientists are, too (see Aliens may destroy humanity to protect other civilisations, say scientists by Ian Sample posted 8/18/2011 on the Guardian).

It may not rank as the most compelling reason to curb greenhouse gases, but reducing our emissions might just save humanity from a pre-emptive alien attack, scientists claim.

Watching from afar, extraterrestrial beings might view changes in Earth’s atmosphere as symptomatic of a civilisation growing out of control – and take drastic action to keep us from becoming a more serious threat, the researchers explain.

This highly speculative scenario is one of several described by a Nasa-affiliated scientist and colleagues at Pennsylvania State University that, while considered unlikely, they say could play out were humans and alien life to make contact at some point in the future.

This isn’t hyperbole from Al Gore.  It’s NASA affiliated.  So this must be serious stuff.

The authors warn that extraterrestrials may be wary of civilisations that expand very rapidly, as these may be prone to destroy other life as they grow, just as humans have pushed species to extinction on Earth. In the most extreme scenario, aliens might choose to destroy humanity to protect other civilisations.

“A preemptive strike would be particularly likely in the early phases of our expansion because a civilisation may become increasingly difficult to destroy as it continues to expand. Humanity may just now be entering the period in which its rapid civilisational expansion could be detected by an ETI because our expansion is changing the composition of the Earth’s atmosphere, via greenhouse gas emissions,” the report states.

“Green” aliens might object to the environmental damage humans have caused on Earth and wipe us out to save the planet. “These scenarios give us reason to limit our growth and reduce our impact on global ecosystems. It would be particularly important for us to limit our emissions of greenhouse gases, since atmospheric composition can be observed from other planets,” the authors write.

Talk about taking it up a notch.  And this after those emails leaked from the University of East Anglia.  Showing that they fudged many of the numbers they used to sell global warming.  So they changed tack.  Propose absolute gibberish that is completely independent of data.  And sanity.  Thus making it impervious to attack.  Or scientific scrutiny.

Who would have thunk it?  That global warming would bring the final frontier to us.  Where others would travel here.  In their quest to explore strange new worlds.  To seek out new life and new civilizations.  To boldly go where no man has gone before.  And possibly bring a cook book with them entitled To Serve Man

I wonder how many Trekkies were in that group at the Pennsylvania State University.

Long Lines of Communication and Costs make the odds of an Alien Invasion Slim

Let’s apply a little historical perspective on this.  Why did Napoleon not conquer Russia?  Because Russia is a very big place.  It stretched Napoleon’s lines of communication to the breaking point.  He could no longer support his Grande Armée.  And the Russian winter only compounded his misery.  He had no choice but to retreat.

Why did Hitler not conquer Russia?  Ditto.

Now let’s look at some economic history.  Why did NASA cancel Apollo missions 18, 19 and 20 to the moon?  Because they were too costly.  Why have we not landed a man on Mars?  Because it’s too costly.  Why did we cancel the Space Shuttle program?  Because it was too costly.

Put long lines of communication and costs together and what do they tell you?  The odds are slim for an alien invasion.  Because you have to benefit somehow for the costs you expend.  Hitler wanted living space.  Grain.  And Caucasus oil.  His hatred of Jews, Russians and communists was one thing.  But killing all of them meant little if he didn’t get the living space, grain and oil.  That was the desired payoff for his investment in the invasion of Russia.

“There is Nothing more Dangerous than a Wounded Mosquito”

Granted, this is pure speculation, but let’s assume invading aliens are like all other conquering people history has known.  That is, they want something.  Something real.  Food.  Resources.  Whatever.  And if they are able to conquer the space-time continuum, they’d be pretty darn smart aliens.  And resourceful.  They could probably do just about anything when it came to food and resources.  Probably even make a clothes washer that can fold and wrap clothes in a plastic wrap.  And if we become an annoyance they could probably dispatch our world before we could put the first thoughts of a starship on a drawing board.

So there is little point in expending any time, effort or money in preparing a defense for an alien invasion.  And there is little chance that our so called global warming is going to bring a Death Star to our corner of the universe.  Such talk appears to be a ruse to increase government spending.  What some would call ‘grasping at straws’.  Just another way for the Keynesians to continue their failed policies. 

The Obama administration has shown the futility of Keynesian economic policies.  And it has wounded the Keynesians deeply.  But like the mosquito, we should be careful.  For as they said on Monty Python’s Flying Circus, “There is nothing more dangerous than a wounded mosquito.”  They will find other ways to tax and spend.  No matter how silly, ridiculous or costly it is.

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