Basically, the reason that public sector spending destroys jobs is because it takes the federal government $1.25 to procure the same amount of goods and services that can be procurred in the private sector for $1.00. This phenomenon could go by the simple name of “inefficiency”, but I prefer to call it “the degraded purchasing power of the federal dollar”.

When $0.25 of purchasing power is lost billions and billions of times over, that represents hundreds of thousands of jobs that will never come into existence because the federal government is spending those dollars instead of the private sector entities from whom those dollars were extracted.

Why can private sector entities make more happen with a dollar than the federal government? This is equally easy to understand. Private entities have a duty to the “bottom line”. Elected officials have a duty to their reelection.

But those politicians who are genuinely concerned for the American people will want dollars to remain where their purchasing power — and job creation power — is maximized. In the hands of the people and companies who created those dollars in the first place.

—Tom Nally, New Orleans