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Thread: What makes people think cuts in government spending boost the economy?

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    Re: What makes people think cuts in government spending boost the economy?

    Quote Originally Posted by pdog View Post
    Not necessarily, you could increase taxes on those with a lower propensity to consume to offset the tax decrease on those with a higher propensity to consume. The net tax "revenue" remains the same, but consumption would increase.
    I'm talking about something like suspending the payroll tax.
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    Re: What makes people think cuts in government spending boost the economy?

    Quote Originally Posted by David_N View Post
    I unblocked you to respond to this.

    Really? Good to know that you agree.

    The us government, as a currency issuer, is not like a household. Household debt is a very real burden, government debt? Not so much.

    We control how much interest we give to individuals who hold bonds, and it's a political choice to slash other spending. No real constraint.

    The fed controls interest rates.

    No, Pseudopseudohypoparathyroidism is a big word. Austerity is a disease.

    Go here: http://www.debatepolitics.com/govern...-security.html (Some Quotes about going "bankrupt" (Medicare/social security))

    Who said we're practicing austerity to the degree that other countries are?

    Err, they could've abandoned the euro and moved to their own currency. Or the IMF could stop decimating Greece and other countries.

    If they had never given up their ability to control their own currency, they'd be in a much better spot.
    Same old broken record but I'm flattered that you had me blocked. Just proves that you want to ignore the truth and live in your own little fantasy world.

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    Re: What makes people think cuts in government spending boost the economy?

    Quote Originally Posted by Moderate Right View Post
    Same old broken record but I'm flattered that you had me blocked. Just proves that you want to ignore the truth and live in your own little fantasy world.
    I've addressed every one of your points. If you don't want to debate, that's fine...
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    Re: What makes people think cuts in government spending boost the economy?

    Quote Originally Posted by Fenton View Post
    You screamed Texas, 3 times, not me and I base my ideology on what works which is more than I can say for you.

    Yea its easy to increase GDP, just spend yourself into another Soverign debt crisis, just load the banks back up with worthless bonds, create more empty towns with unused infrastructure.

    Arbitrary spending "to increase aggregate demand " led to Spains ghost towns and airports, the last thing they need is more empty streets and apartment buildings.

    And GDP our of context is a piss poor way to judge the health of a economy. Even MMTers should understand that.
    Dave is using his usual tactics of cherry-picking, taking facts out of context and assuming correlation equals causation. He leaves out little details like the fact that cuts in gov't have a LONG TERM effect and only focuses on the short term. He ignores the fact that gov't's do not create wealth, they simply move it around and GDP is about the movement of wealth, not the creation of wealth.
    Our nation has not always lived up to its ideals, yet those ideals have never ceased to guide us. They expose our flaws, and lead us to mend them. We are the beneficiaries of the work of the generations before us and it is each generation's responsibility to continue that work. - Laura Bush

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    Re: What makes people think cuts in government spending boost the economy?

    Quote Originally Posted by Fenton View Post
    Spain already has entire ghost towns with infrustructure and a few airports that were built during the height of Spains property bubble.

    All empty, never used.

    Its a example of the Keynesian " build it and they will come '' mentallity run amok.

    Spain's Ciudad Real airport sold at auction for ‚10,000 - BBC News
    Can we get past the fact that our entire infrastructure is in dire NEED of overhaul before we talk about hyperbole like this? Further isnt' a bubble exactly that? A bubble? I suppose you could partly blame the government in the creation of that bubble, but the bubble wasn't caused by deficit spending.

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    Re: What makes people think cuts in government spending boost the economy?

    Quote Originally Posted by David_N View Post
    What works? Supply side economics doesn't work.

    What debt crisis are we facing?
    What worthless bonds? There's a reason they're in demand.
    Nothing wrong with some empty towns..

    So they focus on repairing existing infrastructure/other initiatives. Infrastructure spending isn't perfect, but you can't deny the benefits of those few ghost towns/airports for the workers and businesses providing the materials.

    What's out of context?
    Supply side does work. Millions of Americans and thousands of bussineses voting with their feet and moving here, to the GREAT state of Texas prove that Supply side works.

    Using incentives to increase private sector investment which leads to job creation is beyond the comprehension of someone who thinks that a Nation could and should spend its way to prosperity

    NY and California are both trying to emulate Texas's supply side iniatives by giving tax breaks to Companies that relocate there . NY gives a 10 year tax break to Companies that relocate there so dont tell me Supply side doesn't work, of course it does

    And Spain spending led to more than just a few ghost towns. Politicians were actually prosecuted which is what should have happened here.
    Last edited by Fenton; 04-29-16 at 09:26 AM.
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    Re: What makes people think cuts in government spending boost the economy?

    Quote Originally Posted by David_N View Post
    I've addressed every one of your points. If you don't want to debate, that's fine...
    I've heard it all before, many times. The trouble is you guys think that we don't understand your views so if you keep on repeating them then maybe it will eventually sink in to us. It doesn't ever occur to you that we do understand your views and dismissed them as poppycock. But, that doesn't stop you from regurgitating the same old stuff over and over again. All of this stuff has been debated over and over numerous times and both sides are still at square one. We will never convince each other of the error of their ways.

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    Re: What makes people think cuts in government spending boost the economy?

    Quote Originally Posted by David_N View Post
    I'm talking about something like suspending the payroll tax.
    oh sure - arguably one of the dumbest things our government does...taxing labor.

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    Re: What makes people think cuts in government spending boost the economy?

    I'm not sure people think reduced government spending helps the economy. What they fear is that the temporary advantages of government overspending will finally come to an end and the ensuing crash will be miserable. It doesn't matter who prints the money. You cannot pick money from trees forever. It is not a sustainable activity. Just look at the what has happened to countries who have seen a loss in confidence in their currency.

    What does help the economy is a reduction in taxation because it leaves more money in the hands of taxpayers who can spend in a sustainable way. The left wing economics will eventually hurt us badly. It can't be otherwise.

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    Re: What makes people think cuts in government spending boost the economy?

    Quote Originally Posted by Moderate Right View Post
    I don't think anyone actually ever said that cuts in spending boost the economy but we do need to get our financial house in order and not run up debt that becomes an ever larger percentage of the spending we have. We're just lucky right now that interest rates are low. Austerity is a big word. If we keep our financial house in order true austerity won't be needed. Just because we cut spending a small degree doesn't really mean we are practicing austerity. Austerity was forced on Greece because they had no other choice. They had already gone past the point where their bubble burst. If they had been fiscally responsible in the first place they wouldn't have needed austerity and don't go giving me any crap about how that situation is different.
    Can you explain what getting "our financial house in order" entails and how it will benefit our economy?

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