Can Manned Spaceflight Save the Economy? 224
Barry asks: "Driving home last night I was listening to a particularly goofy AM talk station. Just before the syndicated UFO talk show 'Strange Days... Indeed' came on, the discussion turned to the Mars Rovers and George Bush's newfound love of space exploration. The interesting thought was that a large number of American political leaders were about to join Bush in endorsing a new manned space program because it would generate 'millions of jobs'. Given that manufacturing jobs are being shipped offshore, and high tech jobs are following, this almost made sense. A primarily unemployed population could mean big trouble. So I am wondering how many people were employed during the height of NASA's glory days, and what kind of economic impact would we expect if a similar program - a Mars mission for example - were launched today?"
Re:ummm flawed logic? (Score:3, Informative)
Re:sure, why not? (Score:5, Informative)
Only if you can make the assumption that an individual in his or her capacity as a government official is a near-perfect economic decision maker, yet that same individual in the capacity of a private citizen is nearly entirely incompetent to make economic decisions. Otherwise, there's no basis for not leaving the money in the hands of the taxpayers and letting them spend it how they please.
Governments are nearly always massively inefficient. After all, they have no incentive to improve. A company that is profligate with its resources will quickly go bankrupt, a government merely has to ratchet the taxes up a little higher. Now you say "if the citizens are willing" but that's very elastic: a citizen prepared to pay say 30% of income in taxes for the "greater good" might well feel very differently if the government decided it wanted 60% or 90%*. But the government is fully incentivized to increase taxes, not to spend the money better.
We see a similar problem in the UK at the moment. There is a lot of fuss over private (fee-paying) versus State (taxpayer-funded) schools - the quality of the former so outstrips the latter that the government is even artificially making university admissions harder for the privately-educated (rather than improving its own schools). But it turns out, if you do the accounting, that State schools actually cost the same or more per student than a private school! The money is just soaked up in government inefficiency. The same is true for the NHS, where the present government has managed to increase the number of medical staff by 15% and the number of managers by 45%.
The way to economic prosperity is to cut both taxes and governemnt spending, so those that earned the money directly control how its spent. This has worked in every economy that has tried it.
And private industry is unlikely to go into space anytime soon--it's not profitable.
I'm sure the same was said of expeditions to explore the world's oceans.
* This is not unheard of - in 1979 in the UK the top rate of income tax was 83%, with an extra 15% charge if the money was from investments rather than salary. That's a total of 98% tax! No wonder that economy collapsed in the "Winter of Discontent" and a new service-based economy emerged!
Re: finite amount of money? (Score:2, Informative)
Re:Nothing diversionary (Score:1, Informative)
Pass the balanced budget amendment, and give the President a line-item veto, and the defecit and debt would quickly go away.
Re:sure, why not? (Score:3, Informative)
Let's say 2 adults, 2 children that's GBP 12,000. The figure of approx GBP 23,000 you quote is before income tax, national insurance, council tax and all the other various taxes levied by various parts of the government. They can easily eat up half of your income.
Surely, that depends whether you are unemployed, sick, disabled, mentally ill or living in poor accommodation, doesn't it?
As I say, perhaps we would all be better off if everyone got their GBP 3000 without wasting money on all the bureaucracy in the middle. Remember that's not GBP 3000/household but per person, including children.
However, if a mentally ill person were to attack you in the street, you'd consider a welfare system quite desirable. If you were mugged or burgled, you might wonder if it would have been a good idea for the state to provide a safety net for that person before they turned to crime.
Are you trying to suggest that poverty automatically leads to crime? That seems rather a shaky assertion to me.
Do you think that there might be even the slightest chance that there is a direct economic link between the quality of life in a given country and the degree of welfare support provided to the citizens of that country?
Perhaps you would care to explain how paying people not to engage in productive economic activity results in the creation of a productive economy?
About the only way to do that would be to argue that welfare keeps the non-productive out of the way of the productive, but still, there are more cost effective ways to do that then paying them to sit around watching daytime TV and smoking cigarettes all day. I believe the Americans call it "workfare".
Re:ummm flawed logic? (Score:2, Informative)
Re:ummm flawed logic? (Score:3, Informative)
No, they wouldn't.
In any standard macro model, the size of the economy is the sum of all goods and services produced, not the size of the money supply. Production requires labor and capital, both of which may be enhanced by "technology" (which doesn't necessarily mean the same thing to an economist that it does to an engineer). Money is a convenient medium of exchange, and a nice way to measure things, but has value only in the sense that it represents labor or capital. Unless NASA's contract makes use of labor and capital that would otherwise not have been used (that is, otherwise unemployed workers and idle machinery), more stuff made for NASA means less other stuff made. Your companies A-F may prosper, but there are companies G-L somewhere that are worse off.
Government spending can influence what things get produced -- take money that would have been spent on plasma TVs away from people by taxing them, spend it on Saturn V boosters instead (note that money is still just a medium of exchange here -- it's easier for the government to take $100 than it is to tell you, "Don't go to your regular job on Tuesday, show up in Houston to work on the Saturn V instead.") Deficit government spending can temporarily stimulate demand for goods -- borrow money that would otherwise have been saved/invested, and spend it on goods instead. If the government simply prints money and spends it, but the total output of goods is unchanged, you get inflation -- each dollar in the money supply represents a smaller quantity of goods. Of course, the real-life situation is enormously more complex than what we're discussing here.