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This Post Was Not Funded by the Stimulus
Wednesday, January 27th, 2010CNN reports that Ohio has spent $1 million in stimulus on signs to let Ohioans know which projects are being funded by the stimulus.
Over at the Consumerist, a commenter offers one of my favorite justifications for this sort of waste, a variation on the broken window fallacy:
As long as the signs were made in this country and employed people, why is this bad? It put people to work.
Good point! In fact, Ohio should another billion or so on signs designating everything in Ohio that’s not being funded by the stimulus. And perhaps for each of those signs, another sign informing Ohioans that the original signs and their companion signs are courtesy of the stimulus.
I mean, think of how many people you could put to work!
I live in Cleveland and have seen and mocked these signs repeatedly. If I had any. The signs read “Project Funded by the American Recovery and Reinvestment Act,” and I’ve dreamed of replacing “the American Recovery and Reinvestment Act” on those signs with “the Chinese and your great grandchildren,” or “Money we don’t have.”
I think you just invented a perpetual motion machine! Brilliant!
Come on, Radley, you’re clinging too tightly to that whole “does the work actual benefit or create a value to anybody” criterion.
A task was performed, a check was cut, why do we need to go any further in this inquiry?
Hey! Here’s an idea, why don’t readers here post the CNN article on their blog or facebook and see how quickly someone comments with exactly those same asinine sentiments? It can be a contest. Winner gets the title of “silliest friends/readers.”
the broken window logic is brilliant for giving jr hs boys license to vandalize property guilt-free and for giving politicians license to spend guilt-free…
Why is it bad? Try paying your dying kid’s hospital bills without the money used to print up signs.
Until every dollar is precious, the waste won’t stop.
Until the state understands it isn’t THEIR money, the waste won’t stop.
As long as the signs were made in this country and employed people, why is this bad?
Because those people could have been put to work doing something productive. The end.
I agree this is silly and wasteful, but signs like this are already a part of our bureaucratic culture. Even before the stimulus we were surrounded by signs trying to placate those stuck in traffic with “your tax dollars at work” signs and don’t even get me started on how much money is wasted every time a city gets a new mayor or a state gets a new governor. All those park benches repainted, all those “welcome to..” and other signs redone. (I’m just driving through, I neither know nor care who your governor is!!) I suspect it would make this $1 million look like peanuts.
Again, not disagreeing, but wasteful, political-signs-masquerading-as-information signs is a horse that has long been out of the barn.
But that justification is new idiocy.
They probably outsourced the work.
Some famous economist was given a tour of China decades ago. The proud Communist engineers showed him how many people they employed building dams by eschewing the use of heavy earth movers in favor of shovels. The economist replied, “You’d employ even more people if you gave them spoons instead.”
I believe it was Keynes who proposed that the government put Federal Reserve notes in glass bottles, drop them in abandoned mineshafts, dynamite the entrances, and tell companies to go dig up the bottles.
There is no end to insanity in human relations.
Ugh. I can’t stomach the Consumerist comments anymore. A cesspool of craven nanny-statism. There is literally no government rule or regulation that they don’t unquestionably champion.
“It put people to work.”
Cool. I have now submitted a grant request for ARRA funding to provide my wife and I with a full servant staff—butler, cook, chauffeur, groundskeeper, and three maids—using exactly that same justification.
As I understand it, the point of the broken window fallacy is that there’s a net loss to the economy in the value of the window. Nobody is breaking anything here, so it’s hardly applicable.
Likewise, the point of the stimulus was to plow some money into an otherwise-stagnant economy so as to prevent it from imploding completely. You can agree with it or not, but there’s nothing inconsistent between that stated purpose and the highlighted comment.
I live in Ohio. I think they’re way ahead of you on this one. The highway outside my town was under construction to build a bridge overpass over the last 4 or 5 years and was completed two years ago, well before any of that “stimulus money” was spent here in Ohio.
Yet there’s a sign up on the side of the road indicating that something there was paid for with the stimulus bill. Other than the sign itself, I don’t see anything in the vicinity that could possibly be new development and infrastructure.
Matt: They’re printing signs that didn’t need to be printed, just like the broken window fallacy relates to manufacturing windows that wouldn’t otherwise need to be manufactured if they hadn’t been broken in the first place.
Actually, I got banned from commenting on the Consumerist for trying to point out these types of arguments. I was “frequently trolling”, which is apparently what they call it when you disagree with the article’s premise that corporations are evil and enslave people while government is good and only champions for the weak and needy.
So, they want their little echo chamber. I’d say let them have it.
There are a couple of these signs near my office, and I just cringe every time I see them. What’s worse, though, is the road project they’re advertising. They’ve taken a “T” intersection (main road and entrance to my office park) that didn’t need anything done to it, and have repaved the sidewalks on the corners and installed new crosswalk signals. It’s a sidewalk that maybe 10 people use per day.
Also, the best part is that they also repaved the sidewalk on the dead-end side of the T. That sounds great, but if you go about 25 feet south, the sidewalk ends and grass begins for another 50 feet or so.
If they insist on using the freaking money, why not continue that sidewalk to a natural end – like at the next road? Right now, they have “improved” a crosswalk that only leads to a sidewalk that goes nowhere.
Likewise, the point of the stimulus was to plow some money into an otherwise-stagnant economy so as to prevent it from imploding completely.
And where is the money for this supposed to come from? Every dollar the government spends is a dollar diverted from some other purpose. Sometimes the government will spend money in such a way as to enhance wealth creation. For example, paying people to build a road may reduce the cost of transporting goods; every dollar saved is a dollar of wealth generated (offset by the wealth that was consumed building the road). If such wealth exceeds the quantity of wealth required to build the road, then the government’s expenditure may increase the overall wealth in society more than would simply letting the money remain in the hands of the people from whom it would have been taken.
Spending a thousand dollars to have someone perform some useless task, if the time is worth that much to the person performing it, will destroy a thousand dollars worth of wealth. It does not create wealth, nor “inflate” the economy. Rather, it simply deepens the recession, which will then be used as an excuse for even more wrong-headed spending, which will deepen the recession further, etc.
We have a similar situation up here in Canada, where the government has spent a reported $250,000 in photo-ops to deliver “report cards” that the opposition demanded be required in law before they would agree pass the budget.
So they got their wish, except that instead of a dull report in the House of Commons, they’re getting big media events that cost a bundle. But you’d think they would be happy about all this, since no doubt many jobs are being “created” through all this expense.
http://www.theglobeandmail.com/news/politics/conservative-stimulus-report-cards-cost-taxpayers-250000-so-far/article1445114/
Our “Government Action Plan” up here is something similar, although that’s one fairly large, standard sized construction effort sign per site for each one I’ve seen in my city. (Think of any “Possible Land Use Change” signs you’ve seen.)
One million dollars to me is a fraction of a piece of a drop in the bucket for the stimulus package. How many projects? How many signs? How much does it cost to manufacture and maintain other project signage? Is there real indication of waste here, or are you being purposely vague?
Do you really think that it can’t add up? What would have been an appropriate amount?
I’m sorry that you ran into the broken window fallacy, but really, it’s not bad that the stimulus caused need in industries to support it. Especially considering that’s what the whole thing was for in the first place.
*Gasp* The stimulus plan is spending money and creating jobs! REVOLUTION!
Paulson came out today and admitted that there would have been 25% unployment without the aig bailout. Radley has yet to counter with any argument in support of not bailing out. He just sits around and farts, and posts on his blog, without actually contributing muh of anything.
@MattD: The “broken window” in this case is alternative purchases that would have been made with the tax dollars that could have otherwise been in the pockets of citizens.
Government cannot spend money without either taking money directly from it’s citizens or printing money for itself – which in turn makes the money everyone else has worth less.
In both cases, they’ve decreased the purchasing power of the individuals who make up the economy.
http://www.ic.gc.ca/eic/site/708.nsf/eng/h_00009.html#ques26
It’s all about transparency compliance here.
The ones I had are the cast bronze plaques for infrastructure “built under the administration of …”, as though the elected officials contributed anything.
Signs and broken window fallacy.
Although the broken window fallacy makes sense, I can see one case where printing signs might be good. Suppose that instead of posting signs/buying windows, the person with the money did nothing and kept it in a checking account. Is not spending money worse than spending money on non-useful items? i know the governments take their tax cuts of transactions, but how does the velocity of money play into these scenarios?
Money put in the banking system still works for the economy. Money that’s hoarded can still be spent later (and thus retains economic value).
Spending money on initiatives that destroy or waste something else in order to line the pockets of certain individuals.
I don’t believe that to be the case here, because it’s simply an advertisement and awareness effort to promote transparency. It allows communities to see what good is coming from the spending and it thus serves a purpose, and a disproportionately important one to the spent amount.
#20Paulson came out today and admitted that there would have been 25% unployment without the aig bailout.
Bullshit. He’s trying to cover his ass after the backdoor bailout of Goldman through AIG.
Who do you think was CEO when Goldman bought most of those CDOs?
Gm, I say I’m king of Londinium and wear a shiny hat.
Doesn’t mean it’s true. And considering how gov’t calculates unemployment (and how gov’t keeps adjusting the previous calculations after the fact) there’s no way anyone can know the “benefit” of the AIG bailouts (well, we do have a pretty good idea of the bonuses paid out…)
Ok, I’ve been driving a truck for the past couple of months and had been laughing my ass off at the signs myself. The worse part: They tend to go into construction zones where the speed limit is dropped to some ridiculous level.
I believe it is right on I80 around the Illinois/Indiana border on the south end of Chicago where they have the speed dropped to 45mph (on the friggin interstate!!!) Now add up the cost of slowing down freight and commuter traffic to the cost of the signs and you realize the actual cost of those signs (and projects) are much, much higher. I almost want to go to Congress and ask for funding for the Bridge Over Illinois project I have in mind. Of course, I’d have to add a single exit that puts you right at Wrigley so I can catch the Cubs games during baseball season…
I dunno. Is a million dollars a significant fraction of the stimulus money spent in the state of Ohio?
I do a fair amount of work. And I spend a tiny fraction of that time reporting on what I’ve done to my employer. I suppose if I spent a quarter of my time trumpeting my achievements–and I suspect we’ve all known someone like that at some point–then I’d be kind of a tool, but using a very tiny bit of one’s resources to report on what one is doing seems pretty routine.
So I suppose it comes down to how big a fraction of the money it is. If they’re spending $1 million of their $2 million budget on the signs, then I’d say they’re being wasteful. If they’re spending $1 million to communicate to the taxpayers about how they’re spending billions, then I think it’d probably be petty to moan about it.
As Matt D said – the whole purpose of the stimulus was to inject money into the economy ASAP, and slow job losses. An effort was made to direct the funds to “shovel ready” infrastructure projects and etc, but there simply weren’t enough of those ready to go fast enough. So, along with projects that produce real benefits you have some make-work projects like this.
All of you complaining: would you rather the government gave the signmakers cash payments and told them to stay home and get used to living on the dole?
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