Government should be counter-cyclic to the Main Street marketplace

Ohio Statehouse

Originally published at: DogWalkBlog.com

I was listening to NPR on WMUB this morning about the freshman Ohio senators starting their terms and how hard their jobs will be dealing with the State having a $1.9 billion budget deficit, GM, Delphi, DHL and other large companies pulling out of Ohio and various other things. Many of the in-coming senators went on and on about how they need to cut government waste and hunker down and spend smarter, blah, blah, blah.

And then it occurs to me: Shouldn’t government be counter-cyclic to the marketplace? When things are going well, the free market tends to create goods and services it needs without help from the government. When the economy is doing well, shouldn’t government be pulling back on services, conserving revenues for a down economy?

When the economy is not doing well, that is when we need government help. That is when the government should ramp up the spending, not pull back. Government waste during fat years is a lifeline to average folks and small business during famine years.

As an owner of a small business, I only heard that the various Ohio Revenue departments are going to start going after every single penny it feels it is entitled to. It will asses property values higher, it will send out random letters declaring I owe this penalty or that missed tax payment, whether real or not. It will extract and extort money from the down and hurting at a greater rate than normal. All in pursuit of “responsible budget balancing.”

And they will further spiral the economic crisis downward and wonder why the budget will never balance. When the Ohio Statehouse policies put people out of business, tax revenues dry up and no matter how threatening the letters are, you can’t get money from people you put out of business and kick out of their homes.

I know it is really hard for elected officials to act responsibly during the fat, happy party years but when we out here on Main Street are doing well, Columbus and DC should be saving for a rainy day, not joining in the party and buying the booze for the drunken puppies.

Am I wrong?

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