oooh...a cartoon on economics!

From Dave Coverley's Speed Bump this morning...



The placard is true, in a sense. Voluntary activity is typically mutually beneficial-- and if so, it increases economic well-being, if not economic wealth. If someone gives this man some money, he and the giver should benefit (with the latter receiving warm fuzzies).

However, when the government forcibly redistributes money from taxpayers to the sign holder, it's another story. Or using some economics jargon: the "Keynesian" angle on this is patently false. It is often thought that government spending will stimulate spending, increasing economic activity. But this forgets that government spending is financed by taxation, thus decreasing economic activity by the same amount. It's easier to see the activity created, but at the end of the day, it's just a shell game-- where creation is at least matched by the destruction.

This is a common issue with government policy-- obvious benefits and subtle costs. The upshot is that the public is far too likely to applaud policies which harm individuals and society.