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Twixlen said:
But isn't there a point where hiring teachers, park rangers, trash collectors, EPA inspectors, police folks, fire folks, etc, creates an economic condition where small businesses can be created & thrive? People have to be employed and be an active part of the economy, creating demand, before it spins off into other hiring and business growth, right? One isn't a bubble from the other - it has mattered, locally, on a state level and to the country, that fewer people are working for government agencies - I get that they were part of the debt cycle, but isn't there a point where they are part of the prosper cycle as well?
Unfortunately, no, that isn't how it works, particularly with public safety forces, though you're correct that the public and private sector are not completely separate, isolated bubbles. Otherwise, you could simply hire a bunch of people to dig holes and fill them in again and society would be wealthier.
Remember that the uncomfortable reality is that the real value a worker adds to society is how much real value that worker produces for how little money. From a macroeconomic standpoint, the perfect policeman is one who can successfully cover an entire city by himself and is willing to work for free. (Until you find one who can cover multiple counties by himself and is willing to pay for the privilege, anyway.) Of course, that extreme is deliberately unrealistic, just to illustrate the point. And yes, the same applies in the private sector as well. The perfect assembly line worker is one that is willing to work 24 hours a day for free, does quality work, and never gets tired, and the perfect plant manager is one that is willing to do the same. (This reality is one of the inexorable pressures towards increased automation in manufacturing.)
Of course, in a perfect world, the policeman would be completely unnecessary because people would obey the law without the threat of coercion, and the soldier as well because no one would ever threaten us from abroad. We don't live in such a world, obviously. Therefore, we need police and soldiers--and we need to pay them, and others doing work that people are unwilling to do for free. However, the moment we start paying them more than we must or hiring more of them than we need, we are destroying real societal wealth (which will ultimately be reflected in nominal societal wealth as well, though nominal figures are much easier to manipulate for a time), not building it.
Launched in August 2010, TheMetropreneur.com is a local online resource devoted to small business development and entrepreneurship. Its aim is to tell the stories of Central Ohio's business community, foster regional economic development and assist entrepreneurs with its resource-heavy focus.