Quote:
Originally Posted by aceventura3
Please understand the full context. The government can take a dollar from one person (or sector in the economy) and give it to another, creating nothing. Or the government can engage in deficit spending which will result in higher taxation or inflation in the future, creating nothing long-term. If government spending created growth or jobs, every nation on earth would have a very simple formula for creating growth and jobs. However, it is clear to most that it does not work.
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You should go study Keynesian economics and the tradition of economic theory both for and against Keynes over the last seventy years or so, and see if you still think the above paragraph holds water. I believe, if you engage honestly with the literature, you'll see it doesn't.
There are very good reasons nations don't try to spend their way out of recession. There are also very good reasons why it could work. It's nowhere NEAR as cut-and-dried as you make it out to be.