[QUOTE="theone86"][QUOTE="BMD004"]Because where does government get the money to spend? It gets the money from the people that make up the economy. They simply shuffle money around. You learned about Keynesian economics... and it's nonsense. Some professors at some schools don't teach Keynes and teach other economic philosophies such as Austrian economics like George Mason University, The University of Chicago, University of Virginia, UCLA, etc.BMD004
It is absolutely not nonsense, I have never once heard someone logically discredit Keynesian economics. I have heard people discredit Austrian economics. Simply put, government finance cannot run in the same manner as personal or business finance, as they are different systems set up to achieve different ends. Example, in a recession there is economic uncertainty and the smart thing to do in terms of personal and business finance is to cut back spending. However, such cutbacks weaken the economy and thus cause it to worsen, causing more lost jobs, less spending, and a viscious spiral. In order to avert a deper recession the government must spend. This is sound economic theory, would you please provide an explanation as to why it's not besides simply saying it's nonsense?
The mistake that you make is that you think a recession is a bad thing. The recession isn't the problem. The recession is the fixing of the problem. Think of it like this. You ate some bad food, and a few hours later you're puking your guts out. Throwing up is what feels bad... but throwing up isn't the problem. The problem was that you ate bad food earlier. Throwing up is your body's way of purging itself of the toxin that you put in your body. It sucks, but it's necessary. And what you are saying is not sound economic theory. It didn't used to always be that way. It's only fairly recently that Keynesian has become "sound economic theory". Keynesian economists think they can soften the recession by spending a bunch of money. Yeah, people won't "feel" the recession as much, but it's only prolonging the recession and setting up a more severe recession in the future. If they would just leave the economy alone and let the recession run it's course, then it would be done and over with rather quickly in comparison. Can you explain how an economy with less government intervention would lead to a quicker recession?
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