Recently, on the pages of the Albuquerque Journal’s business section, some students from the Anderson School at UNM made some salient points regarding the recent federal bailouts. While their points were largely accurate, they concluded by arguing that Congress should dump money that went to the automakers into “green energy” instead.
In a letter to the editor that was published in Monday’s Business Journal, I express my disagreement with the idea that Congress should pick winners and losers, regardless of their future prospects (as foreseen by politicians):
Reading the “Executive’s Desk” column from the various business students at UNM’s Anderson School (April 5) renewed my confidence in the next generation of business leaders. They made a compelling case against government intervention in the U.S. economy on behalf of specific industries and connected it directly to taxpayers’ pocketbooks and lower living standards. These are the inevitable fruits of massive government intervention.
Better still, the students went on to discuss the concept of “comparative advantage” which explains that the U.S economy can continue to thrive regardless of its prowess – or lack thereof – in specific industries and sectors like manufacturing because U.S. workers and companies do other things quite well.
Unfortunately, the students undermined their own case toward the end of their article by asserting that taxpayer dollars that were allocated to the auto bailout should instead be directed toward promotion of so-called “green” jobs. The idea that government schemes to create jobs are worthy of support is every bit as specious as the idea that saving auto industry jobs is worthy of massive infusions of taxpayer dollars.
If Congress wishes to build wealth and grow the U.S. economy, the best policy is to leave entrepreneurs and the marketplace as a whole, free to allocate resources. Picking winners and losers is both corrupting and a road to reduced standards of living.
Paul J. Gessing
Rio Grande Foundation