The Best Stimulus? Spend Less, Borrow Less

History is overwhelmingly clear--the way to combat recession and grow an economy is to keep as much money as possible in every person's pockets, encourage competition, while using reasonable law to provide predictability and stability.

When you have this, you increase people's ability to act in their own best interest and invest, which ultimately benefits society. In fact, unleashing the ability of every individual is far more beneficial to society than anything a few politicians and bureaucrats could dream of. This is because this strategy channels the energies of everybody. The competition is this: the incentive is for people to accumulate wealth for themselves, which may only be done by providing better for others. No transaction takes place unless both parties benefit. The government's job is to act as a referee, and provide a predictably accountable environment for this.

The strategy that says that the government will arbitrarily "create" jobs and do so on the dime of future generations is the progressive philosophy. Progressives argue that John Maynard Keynes taught us this. However, there is absolutely no logic to this, and Keynes himself would agree.

In this article from Fortune Magazine, a scholar talks of these lessons from history. Click here.