The author was incited by Laura Meckler’s question to White House Press Secretary Jay Carney regarding unemployment insurance. The story has made the rounds. Meckler, reporting for the WSJ last week at the White House,
“dared to ask White House Press Secretary Jay Carney how increasing unemployment insurance “creates jobs.” She received this slap down: “I would expect a reporter from The Wall Street Journal would know this as part of the entrance exam just to get on the paper.”
In response, Moore writes that the administration’s failed policies, including the extension of these benefits and the $830B stimulus, prove the failure of Keynesian economics.
I don’t think that Moore goes far enough in his analysis of the unemployment benefit fallacy. If injection of cash in the form of unemployment payments creates jobs, why don’t we give every citizen, unemployed or not, such benefits?
Finally, the article begins with the confused statement that “too often economic theories defy common sense,” and ends with the confusion Americans have over Keynesian policies that simply don’t work as touted. While I agree with the condemnation of government-induced demand, I don’t understand why the economic theories behind this condemnation defy common sense. Perhaps what Moore means to say is that politicians touting bad economic policies defy common sense, but that really isn’t as interesting.