Public spending to "create jobs"

I've always known that any type of government work is necessarily inefficient, since the government has no reason to be efficient due to lacking the profit motive. It's not like the DMV or the post office is going to go out of business, since raising taxes to pay for its inefficiency is always an option. That's mostly what forms my small-government political beliefs.

Extrapolating this to public works programs, as was done during the Great Depression as part of FDR's New Deal, would lead to massively wasteful spending. Amity Shlaes has an excellent column today describing what actually happened then. She knows of what she speaks, as she wrote a whole book about it. Here's an excerpt of the column:

One of the saddest accounts of the public-works job culture I came across involved a model government farm in Casa Grande, Ariz. The men were poor--close to "Grapes of Wrath" poor--but sophisticated. They knew that the government wanted them to share jobs. But they saw that the only way for the farm to get profits was to increase output and to stop milking by hand. Five dairy crew men approached the manager to propose purchasing milking machines to increase output. They even documented their plea with a shorthand memo:

"Milking machine would save two men's labor at five dollars per day . . . Beginning in September would save three men's wages or $7.50 on account of new heifers coming in."

The men were willing to strike if they didn't get the machines, though they feared they might lose their precious places on the farm if they did strike. Their fears proved justified. "You're fired," the workers later recalled the manager replying when he saw their careful plan. The government man was horrified at the idea of killing the jobs he was supposed to create. "You're jeopardizing a loan of the U.S. government, and it's my job to protect that loan. You're through, everyone of you, get out."

It's like paying people to move a bunch of dirt, using hand tools, from one spot to another, and then back again. Yes, it "creates jobs", but it's horribly wasteful. All the money spent on it was sucked from the productive in the form of taxes (money that could have been used on real business investment), and yet it was thrown away on paying people for doing something useless.