Why it wont work

Destination Collapse
by Michael S. Rozeff

...Since government rulers and bureaucrats have chosen to make careers in government, it is logical that they believe in government. It is logical, even if incorrect, that they blame the free-market for shocks to the economy that emanate from government; and it is logical, even if incorrect, that they overvalue government and undervalue markets. They are ordinarily loathe to admit that virtually all the bounty, welfare, and wealth we have comes from free-market activity. Their actions, despite their occasional free-market rhetoric, belie such a belief. They are all too ready to blame the free market and praise government...

Government and the FED are institutions that generate economic shocks, after which they claim that they have the means, and only they have the means, to ameliorate their effects. This is more than ignorance. It is a lie. And because these two institutions have unique powers that affect the entire economy, they generate large and pervasive shocks...

When distortions in economic activity become painfully obvious to large numbers of persons in the economy and to those in government and the FED, and when the repercussions of these distortions affect the political futures of the rulers and the banks that the FED supports, then the boom’s days are numbered. A government can underwrite the laying of railroad tracks indefinitely, but when it becomes clear tracks are being laid to nowhere, then even the government understands that it is not getting a political return on its investment. It will do better for itself to subsidize some activity that buys more votes. Investors will realize that the railroads have amassed large debts and that the traffic on roads to nowhere will not generate enough cash flow to pay off these debts. The railroad boom will falter...

A government stimulus program is an effort to thwart the recession. This sounds good, but it is bad, when we remember that a recession is what happens when the private actors in the economy attempt to abandon uneconomic activities and restore sound ones. A government stimulus program is an effort to thwart the private economy’s adjustment back to a normal economy....