Why Bailouts and Stimulus Don’t Work

Posted on Monday, October 19, 2009 at 11:55 pm

ben_powell.jpgBenjamin Powell at Washington Times: America’s move to act swiftly and boldly misses the point. Bank bailouts and fiscal stimulus bills don’t work because they strive to maintain the status quo. But the status quo is the problem and exactly what needs to be corrected. The U.S. housing bubble drew too many workers and too much capital into construction and related industries. So funding public works projects to keep those companies in business is the wrong solution. See here. (HT: EconLog)