Government Has No Place In The Economy

What should a government do to create jobs? Nothing.

What sounds like a quirky joke among disgruntled taxpayers is a brilliant argument made by Adam Boyton, Chief Economist for Deutsche Bank.

His article in the Financial Review points out that "government intervention in the job market has little effect" which is why "it may be best to leave the market alone."

He shows firstly, where government intervention has been futile. "Manufacturing receives more government assistance than other sectors, but that assistance hasn't prevented significant job destruction industry wide."

Secondly, he shows where jobs have grown - in industries that didn't ask for handouts. "Governments haven't promoted the professional, scientific and technical services sector. Yet it has been one of the biggest job creators of the past 20 years."

Services that customers are willing to pay do not require government intervention. As Boyton says "It's hard to recall any Australian government actively encouraging Australians to go out to dinner or grab a coffee, but  over the past 20 years almost a quarter of a million jobs [have been] created."

It's time politicians took a proper role in the economy: minding their own business, instead of ours.

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