Tuesday, March 9, 2010

The Malthusian Paradox

We’ll never pay for all the desired social programs. Think of this as the Malthusian Paradox. As social programs are created they take money from the money-generating sector. Money creation slows and social programs have to be halted, cut-back or eliminated. Conversely as wealth is being created there is less need for social programs. There is a point on the scale, analogus to the sweet-spot on the Laffer Curve, where the social good of government programs and the economic detriment balance out. Unfortunately that is an unknowable, unproveable point.

Furthermore, as with the Laffer Curve, it doesn't address the philosophical and constitutional problems inherent in social programs.


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