Keynesians have consistently been calling for a public works boom to help lift us out of our current economic doldrums. They insist that spending on public works helps create jobs, and that it brings about much needed infrastructure improvements as well.
But as Virginia Postrel points out, public works “[p]roject promoters routinely overstate benefits and understate costs — and not just a little bit.” Read the whole thing, and you will find out just how deleterious many public works projects turn out to be.
I guess that in the Universe of the Keynesians, these facts just don’t matter. When you have people swear by the broken window fallacy, and when you have actual economists (note that I didn’t write “good economists”) tell us that “all spending is good spending”, it should come as no surprise whatsoever that Keynesians don’t care that the public works projects they pine for suffer from cost overruns, and don’t deliver on promised benefits. But in an era of fiscal crisis, the rest of us should be more sober than the Keynesians, and insist on getting the biggest bang for our buck.
I know, I know; prudence in spending is something of a revolutionary thought in certain circles. But it ought to be tried anyway. Who knows? Watching where our money goes might actually bring about some good results.