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Writer’s argument misses the point

March 31, 2013
The Herald-Star

To the editor:

In his Monday guest column, Scott Paul of the Alliance for American Manufacturing proposes that the American economy can be helped if only his organization be allowed to dip its hand into the pockets of the American taxpayers ("Common sense needed when it comes to buying American.")

His argument is to support the Invest in American Jobs Act that would require government to buy only American-made materials when spending on infrastructure projects. According to Paul, "Such a preference stimulates the larger economy, keeps our tax dollars in our communities and creates jobs at home by creating demand." This statement may sound like a fine idea to anyone who has not taken a basic course in economics. Forcing taxpayers to pay higher prices for construction projects than they otherwise would in a free market reduces their demand for other products and reduces the size of the economy in the long run.

Manufacturing is doing just fine without the help of the taxpayer. According to the Federal Reserve Bank of St. Louis, the index of manufacturing output has risen from a level of 80 at the end of the recession to more than 98 today. Since 1990, the index has risen by 78 percent.

Paul makes a very good argument for the kind of crony capitalism that has given us the slow economic growth of the past several years, and advocating a policy that steals from the American taxpayers is not a noble cause.

Joseph Zoric

Associate professor

of Economics

Franciscan University of Steubenville

 
 

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