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To: MNJohnnie

Very true.

Johnny Maynard would be very disappointed in how his ideas have been misapplied.

As I understand it, items from his economic theories as to how public spending impacted the economies were utilized to justfy jump-starting a stagnant economy by a sharp-short bump in government spending.

These efforts were claimed to have produced some benefit and, like magic, a whole program of constant government “stimulas” came to be accepted despite its costs and lack of efficiency. The taxes to finance and/or the inflation to print-around that spending became big factors in making econimic cycles deeper and prolonged — the exact opposit of what Keynes would have proposed.


50 posted on 06/21/2011 12:32:42 PM PDT by KC Burke
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To: KC Burke
Basically the theory worked like this.

City A builds a new road connecting a to b. The economy benefits from the material purchases and the wages paid. it also got a new capital good which would open up new areas to development (new gas stations and shopping centers along the new road) which requires new employees who require new services (dentist, doctor, grocery store etc.

Very little of the 0 Stimulus was stimulative because very little was actually shovel ready jobs but instead was money give to local and state governments to keep union workers employed. Now the money is running out, the economy has not recovered and those jobs still have to go. All the 0 stimulus did was delay the pain.

52 posted on 06/21/2011 12:38:59 PM PDT by MNJohnnie (Giving politicians more tax money is like giving addicts free drugs to cure their addiction)
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