Public Works

[HMS Vanguard]

Do you support public works, by which I mean, buying things for the purpose of providing a subsidy to the producers, and not to obtain the thing (so, for instance, building a 'bridge to nowhere' is public works, but the fire brigade isn't)?

If so, why? The whole idea seems totally nonsensical to me, since the funds to pay for them are not new funds, and merely taken from others and the ends they would have chosen to put them to. The only result of this that I can see is to distort production, from things people want to buy to things they do not.

[Gandalf]

Why are you using such a wacky definition of public works?

[Count Chocula]

Well hello, little troll.

Try using correct definitions of phrases, avoidance of loaded phrases, proper context, and oh I guess facts next time around.

PS I'm not trying to moderate.

EDIT just read your post #2. I retract my "troll" accusation.

[General Zod]

Do you support public works, by which I mean, buying things for the purpose of providing a subsidy to the producers, and not to obtain the thing (so, for instance, building a 'bridge to nowhere' is public works, but the fire brigade isn't)?

If so, why? The whole idea seems totally nonsensical to me, since the funds to pay for them are not new funds, and merely taken from others and the ends they would have chosen to put them to. The only result of this that I can see is to distort production, from things people want to buy to things they do not.

This is a mind-numbingly stupid definition of "public works". Do you have any legitimate source you pulled this out of that isn't your ass?

[HMS Vanguard]

Since that's a definition (ie. a premise of the argument), I don't need to "source" it. Maybe it's not perfectly phrased, but there is a clear distinction between government spending that is aimed principally at obtaining a good or services (eg. maintaining roads) and government spending that is aimed at injecting money into businesses or to workers (eg. building the autobahns in 1930s Germany in which hardly anyone owns a car). That is the distinction I am trying to make.

If you think this is a nonsense distinction please do propose a different definition.

[Gandalf]

Your definition of public works seems to just be throwing money into useless things, as opposed to actual public works which are defined as having a benefit for the populace.

So, your whole question is "Who dislikes useless money sinks?"?

[HMS Vanguard]

The 'utility' of these sorts of works is usually defined as being reduction in unemployment or Keynesian aggregate demand stiumulus. I take it you chaps aren't Keynesians then?

[General Zod]

Since that's a definition (ie. a premise of the argument), I don't need to "source" it. Maybe it's not perfectly phrased, but there is a clear distinction between government spending that is aimed principally at obtaining a good or services (eg. maintaining roads) and government spending that is aimed at injecting money into businesses or to workers (eg. building the autobahns in 1930s Germany in which hardly anyone owns a car). That is the distinction I am trying to make.

If you think this is a nonsense distinction please do propose a different definition.

In other words, you're pulling your definition out of your ass. In fact, there's a much simpler definition than the bullshit you posted. "Public works are the construction or engineering projects carried out by the state on behalf of the community." No bizarre pseudo-legalese necessary. Who'd have thunk it?

[ray245]

The 'utility' of these sorts of works is usually defined as being reduction in unemployment or Keynesian aggregate demand stiumulus. I take it you chaps aren't Keynesians then?

Well, there is a difference between wise and unwise spending of money. You know, you could actually support wise spending of public funds and be against misspending them at the same time.

[HMS Vanguard]

Since that's a definition (ie. a premise of the argument), I don't need to "source" it. Maybe it's not perfectly phrased, but there is a clear distinction between government spending that is aimed principally at obtaining a good or services (eg. maintaining roads) and government spending that is aimed at injecting money into businesses or to workers (eg. building the autobahns in 1930s Germany in which hardly anyone owns a car). That is the distinction I am trying to make.

If you think this is a nonsense distinction please do propose a different definition.

In other words, you're pulling your definition out of your ass. In fact, there's a much simpler definition than the bullshit you posted. "Public works are the construction or engineering projects carried out by the state on behalf of the community." No bizarre pseudo-legalese necessary. Who'd have thunk it?

That definition does not distinguish between different types of public spending - I am not trying to consider the police or even things like UHC, but 'economic stimulus' spending.

[Vendetta]

In other words, you're pulling your definition out of your ass. In fact, there's a much simpler definition than the bullshit you posted. "Public works are the construction or engineering projects carried out by the state on behalf of the community." No bizarre pseudo-legalese necessary. Who'd have thunk it?

Yes, but that definition is clearly useless because it doesn't lead in to whatever harebrained little philosophy (probably some species of lolbertarianism) was about to come up next, whereas the definition of "public works" as "anything which I didn't like the idea of" does.

[Gandalf]

That definition does not distinguish between different types of public spending - I am not trying to consider the police or even things like UHC, but 'economic stimulus' spending.

That's like saying that the term "car" doesn't distinguish between a Volkswagen and a Lada.

Public works is an umbrella term. There's types of public works, like infrastructure, buildings, etc.

[General Zod]

That definition does not distinguish between different types of public spending - I am not trying to consider the police or even things like UHC, but 'economic stimulus' spending.

Your example was poor to begin with. Public works still require money to maintain or else they'll become unusable, so the initial cost to build them is not the only consideration involved. That doesn't mean there needs to be some totally separate category to describe this.

[Rahvin]

Since that's a definition (ie. a premise of the argument), I don't need to "source" it. Maybe it's not perfectly phrased, but there is a clear distinction between government spending that is aimed principally at obtaining a good or services (eg. maintaining roads) and government spending that is aimed at injecting money into businesses or to workers (eg. building the autobahns in 1930s Germany in which hardly anyone owns a car). That is the distinction I am trying to make.

If you think this is a nonsense distinction please do propose a different definition.

In other words, you're pulling your definition out of your ass. In fact, there's a much simpler definition than the bullshit you posted. "Public works are the construction or engineering projects carried out by the state on behalf of the community." No bizarre pseudo-legalese necessary. Who'd have thunk it?

That definition does not distinguish between different types of public spending - I am not trying to consider the police or even things like UHC, but 'economic stimulus' spending.

Economic stimulus spending can actually have the simultaneous purposes of reducing unemployment and injecting money into the economy while improving necessary infrastructure and providing needed services, you know.

Wise spending and economic stimulus are not mutually exclusive. Yes, you can build a bridge to nowhere...but you can get the same stimulus building a new bridge that would alleviate stress on another heavily trafficked one, for example.

Your asinine definition of public works stipulates that all such projects are a waste of money, a blatant falsehood. Do you have any idea what the public works projects of the New Deal built in the US? While the government will be using significant deficit spending to pay for the public works, the communities will see huge benefits in infrastructure improvements/repairs that are long overdo, various companies will be able to stay in business, and unemployment will be significantly reduced.

What gave you the idea that "public works" meant that we'd be starting a bunch of useless construction projects?

[RedImperator]

Enough with the pointless semantics debate. HMS Vanguard ginned up a bizarre definition of public works, but it's clear what he meant was make-work or pork barrel public works, as opposed to necessary infrastructure improvements. The debate at hand is Keynesian economics, not the meaning of a phrase.

[Coyote]

So, would the CCC (Civilian Conservation Corps) work projects of the 1930's count? Because it provided jobs and got stuff done that was handy but not always needed, and some credit it with seeing us through the economic agonies of the Great Depression.

Something like that?

[Pablo Sanchez]

The only result of this that I can see is to distort production, from things people want to buy to things they do not.

Don't talk about distorting production and the free market as if it's always a bad thing. For example, mass unemployment which results in people becoming impoverished and starving to death is a possible market result during a recession or depression. This is obviously undesirable. If make-work allows these people to have jobs and not die, then this was a positive distortion.

Arguably in cases of useless make-work it would be more efficient to simply give people money directly as welfare in times of hardship, but there's a strong potential for this kind of thing to have negative repercussions from having a large part of the populace do nothing all day and endure the humiliation of living on the dole. But in the present American context there is actually quite a lot of useful public works projects to be undertaken, mainly in infrastructure, so there actually isn't any need to do make-work to employ people.

government spending that is aimed at injecting money into businesses or to workers (eg. building the autobahns in 1930s Germany in which hardly anyone owns a car).

I also take issue with your characterization of the autobahn as a makework project. First, the autobahn had strategic utility. Second, although most Germans did not own cars, the Nazis enacted the Volkswagen project which was intended to put automobile ownership within reach of the general populace and would have hit its stride in the early 1940s, so if there had not been a war Germany would indeed have had cars to put on the autobahn.

[Stark]

While he is apparently not arguing public works but economics, his constant repetition of 'bad' public works examples instead of speaking in economic abstract is pretty funny. 'Economic stimulus' spending may or may not 'work' from the perspective of mitigating or fixing depressions, but it often gives money to the poor in exchange for a needed service, and that money is generally blown back into the economy to prevent those poor people dying.

Plaintively asking if people here are Keynesians is funny as shit.

[Patrick Degan]

Do you support public works, by which I mean, buying things for the purpose of providing a subsidy to the producers, and not to obtain the thing (so, for instance, building a 'bridge to nowhere' is public works, but the fire brigade isn't)?

If so, why? The whole idea seems totally nonsensical to me, since the funds to pay for them are not new funds, and merely taken from others and the ends they would have chosen to put them to. The only result of this that I can see is to distort production, from things people want to buy to things they do not.

Tell ya what —when the 60 year old bridge, the maintenance of which has been neglected due to lack of proper funding, collapses into the river while you're driving on it, you can get back to us with your opinion on public works then.

[Kanastrous]

and government spending that is aimed at injecting money into businesses or to workers (eg. building the autobahns in 1930s Germany in which hardly anyone owns a car).

This doesn't look like a good example to support your definition, because the autobahn construction of the 1930s had a definite purpose beyond injecting money into businesses or worker's pockets: the roads were intended to support German remilitarization by facilitating the movement of equipment, supplies, and personnel around the country.

[Alyrium Denryle]

I will actually bite. "Public works" as you define them are good, because of a little concept called marginal utility.

After a certain amount of wealth is obtained, rich people experience this thing called "diminishing returns" where the utility they gain from each additional dollar becomes more and more negligible. By removing a portion of these dollars from them, and redistributing it to people who would otherwise be unemployed, not only do you keep these individuals from starving (gaining more utility from their lack of suffering than is lost from the taxation) but you also get capital moving in the system again by stimulating demand for goods and services.

[CmdrWilkens]

Part of the issue here is that one persons' "make work" is quite often a valuable, or at least marginally valuable, service to others. The CCC is probably the best example of a program which did not generate a lot of infrastrucutre, which didn't address any glaring deficiency nor address a long-term public need. That being said there was still definite utility to their work in terms of park and forest preservation, city beautification, etc. Yes things like mass landscaping may seem like make-work with no value but its something that does provide a positive morale boost to the populace as a whole. A clean park is more attractive to families with children than a dirty one, a neatly landscaped pedestrian plaza is mroe likely to generate foot traffic (with its attendent business impicaitons) and so on. Even some seemingly simple chores can, nonetheless, produce positive psychological results in their communities. Within that context it woudl be hard to find something which does not provide SOME public benefit. The question will always be how much of a public benefit versus the dollars so utilized.

[HMS Vanguard]

That definition does not distinguish between different types of public spending - I am not trying to consider the police or even things like UHC, but 'economic stimulus' spending.

That's like saying that the term "car" doesn't distinguish between a Volkswagen and a Lada.

Public works is an umbrella term. There's types of public works, like infrastructure, buildings, etc.

Sure, which is why I specified not those sorts of things, but only make-work and the like... quite aside from that, people do not tend to actually use the term 'public works' to refer to the police or state health care. I am trying to discuss the utility of 'public works' as the term is generally understood. Calling it "aggregate demand stimulus" might have been better, but I figured fewer people would understand that term. Ironically the opposite seems to be the case, with the supposedly easier phraseology actually just allowing people to pull the debate off on semantics or launch ad homs about my supposed ulterior motives.

Enough with the pointless semantics debate. HMS Vanguard ginned up a bizarre definition of public works, but it's clear what he meant was make-work or pork barrel public works, as opposed to necessary infrastructure improvements. The debate at hand is Keynesian economics, not the meaning of a phrase.

This sums it up... sortof... since this sort of thing isnt unique to Keynesianism, or even to any form of political or economic philosophy over sheer self interest (eg. pork barrel spending, which many keynesians don't like either).

Don't talk about distorting production and the free market as if it's always a bad thing. For example, mass unemployment which results in people becoming impoverished and starving to death is a possible market result during a recession or depression. This is obviously undesirable. If make-work allows these people to have jobs and not die, then this was a positive distortion.

I actually did not use the words you are putting into my mouth. I do think that distorting markets is often or always a bad thing, but clearly that does not stand as an argument on its own, only as a conclusion. Essentially my argument is this - by spending money on public works and employing people in working on them, you are taking away money from other enterprises, since they are funded from taxation (or debt which is delayed taxation). There is therefore no obvious case that this either reduces unemployment or 'stimulates' the economy. Indeed, as the state tends to allocate money badly at the best of times, and surely worse when its principle aim is to spend rather than to extract value, it is almost certain to reduce the total amount of value compared with otherwise.

I will actually bite. "Public works" as you define them are good, because of a little concept called marginal utility.

After a certain amount of wealth is obtained, rich people experience this thing called "diminishing returns" where the utility they gain from each additional dollar becomes more and more negligible. By removing a portion of these dollars from them, and redistributing it to people who would otherwise be unemployed, not only do you keep these individuals from starving (gaining more utility from their lack of suffering than is lost from the taxation) but you also get capital moving in the system again by stimulating demand for goods and services.

As Sanchez also pointed out, this only really justifies direct welfare. But it is also a very spurious concept. Diminishing returns almost certainly do exist, but why are they bad, and why is it better for the poor for them not to exist? If there is less incentive to spend, the rich invest. Investment is what drives economic growth. It very probably is better to be poor in a country that gives you other peoples' savings in the immediacy, but in 100 years? In 200? Economic growth compounds, so even a 1% difference in growth rate makes an enormous difference over time. Who is better off? A poor person in Mexico, or a poor person in the USA?

Part of the issue here is that one persons' "make work" is quite often a valuable, or at least marginally valuable, service to others. The CCC is probably the best example of a program which did not generate a lot of infrastrucutre, which didn't address any glaring deficiency nor address a long-term public need. That being said there was still definite utility to their work in terms of park and forest preservation, city beautification, etc. Yes things like mass landscaping may seem like make-work with no value but its something that does provide a positive morale boost to the populace as a whole. A clean park is more attractive to families with children than a dirty one, a neatly landscaped pedestrian plaza is mroe likely to generate foot traffic (with its attendent business impicaitons) and so on. Even some seemingly simple chores can, nonetheless, produce positive psychological results in their communities. Within that context it woudl be hard to find something which does not provide SOME public benefit. The question will always be how much of a public benefit versus the dollars so utilized.

It's very difficult to spend money and derive NO benefit from whatsoever, I grant that. The problem is, if people themselves valued whatever it is you're spending it on more than anything else they could buy they will do it anyway, and if they're actually going to do that, why bother taking it?

[Pablo Sanchez]

I actually did not use the words you are putting into my mouth.

"Distortion" is a loaded term.

Essentially my argument is this - by spending money on public works and employing people in working on them, you are taking away money from other enterprises, since they are funded from taxation (or debt which is delayed taxation). There is therefore no obvious case that this either reduces unemployment or 'stimulates' the economy.

Why should we assume that the enterprise that money is taken away from has greater utility than the public works project it is given to? That's something that has to be demonstrated.

Indeed, as the state tends to allocate money badly at the best of times,

I dispute this assumption. People like to natter away about how the government wastes money on this or that as if it is a given. It isn't. The overwhelming majority of the US federal budget goes to support programs critical to the health and security of society, like national defense, social security, medicare, and so forth. Earmarking was constantly discussed during the recent presidential election, but as Obama pointed out, earmarking only accounts for .5% of the budget. Tempest in a teacup.

and surely worse when its principle aim is to spend rather than to extract value, it is almost certain to reduce the total amount of value compared with otherwise.

Why?

As Sanchez also pointed out, this only really justifies direct welfare.

As I also pointed out, direct welfare is likely to result in idleness and the loss of self-regard, the avoidance of which is intangible but probably worth a substantial dollar value, often enough to justify inefficiencies in welfare via makework employment.

But it is also a very spurious concept. Diminishing returns almost certainly do exist, but why are they bad, and why is it better for the poor for them not to exist? If there is less incentive to spend, the rich invest. Investment is what drives economic growth.

Different areas of economic intercourse drive growth in different ways and investment is only one facet; consumer spending is another. Countries have to weigh the relationship between consumer spending. investment, and economic growth in determining whether their tax and social policies should favor rich or poor. Moreover, economic growth is not an absolute good because it can still fail to increase general utility. The US economy has grown steadily for decades but real income for most Americans has declined, so we essentially have an extremely stratified economy with obscenely divergent standards of living.

It very probably is better to be poor in a country that gives you other peoples' savings in the immediacy, but in 100 years? In 200? Economic growth compounds, so even a 1% difference in growth rate makes an enormous difference over time. Who is better off? A poor person in Mexico, or a poor person in the USA?

Are you trying to suggest that Keynesian economics are responsible for Mexico's economic position vis-a-vis the United States?

Either way, here's the thing--it is better for a poor person in Mexico today than it was 30 years ago; for a poor American it is worse. This in spite of substantial economic growth in America during that period.

It's very difficult to spend money and derive NO benefit from whatsoever, I grant that. The problem is, if people themselves valued whatever it is you're spending it on more than anything else they could buy they will do it anyway, and if they're actually going to do that, why bother taking it?

You're seriously asking this? Government operates on economies of scale that are unattainable by any private entity or even any coalition of private entities. The American National Parks system, for example, could never have been constructed or maintained by private initiative. Also, government is able to maintain fairly firm continuity over generations in a single project. It can undertake projects at a monetary loss, either temporarily, as in the case of the Interstate Highway System which did not pay for itself for years but eventually did so and more, or permanently, as in the case of the national parks. The government is also able to act as a guardian of the public trust and ignore potential quantifiable profits in favor of value to the community. Imagine the value of the land that Central Park in Manhattan occupies, if it could be offered for development; but the City of New York will never sell it, because its intangible value is incalculable.

[Patrick Degan]

More examples of successful public works would be the many facilities built under the aegis of the Works Progress Administration in the 1930s which are still in use to this day; their utility value over seven decades has more than paid for the budgetary outlay to finance their construction. And Hoover Dam. And the Grand Coulee Dam. And the Tennessee Valley Authority.