many people argue that government spending creates jobs reduces unemployment for example if the government spends seventy million dollars on a new road or military aircraft those projects will employ people however there is a problem with this government spending to create jobs theory economists call it the broken window fallacy they say you might as well pay me to do this that'll create jobs jobs for the people who clean up jobs for the window repairmen and then there's the multiplier effect broken windows also creates jobs for the people who make the truck the people who painted his truck the people who deliver the glass and so on so let's break more windows the government creates jobs argument assumes the money's put to better use than just fixing windows the 70 million goes to building the road or the airplane but unless you believe in the Tooth Fairy the money has to come from somewhere well it came from taxpayers economist Walter Williams points out that that seventy million dollars taken from you now means you have less to spend on a new teapot where newspapers were a restaurant that means fewer jobs for those businesses of course that loss is less visible and politicians love that it's a government policy where you don't see the victims if the broken window fallacy were true than destructive things like hurricanes and earthquakes would be good for the economy after all as the recent hurricanes showed spending increases as people move to clean up and rebuild the damaged areas but again if people would not have had to spend that money on the rebuilding of their houses and businesses they would have spent it on other things like cars refrigerators vacations who knows what this spending would have increased employment in those industries over all the destructive acts of mother nature have reduced the wealth the houses the businesses that were destroyed and there's no reason to expect an increase in overall employment because there's rebuilding the same is true for government spending if governments did not spend the funds taxes would be lower and people would have more money to spend on cars vacations what they value that spending would add to employment the government spending reshuffles jobs it doesn't create them now if people value the things produced by the government more than the things they would have bought then the government spending promotes higher living standards if it's the other way around however it'll lower them so to get the most from our resources government spending should be based on the merits of the spending not the fallacious view that it will create jobs