to figure out a better way

08:21 | 23-07-2013 | Economics, Politics | No Comments

немного очевидной правды:

Progressive economists, led by Paul Krugman, have argued persuasively that what the world economy needs now is government deficit spending to put money in workers’ wallets, to stimulate consumption, to give the private sector a reason to invest and expand. This is the classic Keynesian solution, one proved by years of experience. Krugman tells us that the problem with the world economy now is lack of demand. Indeed, solving the problem of demand has been the essential capitalist dilemma of the past 80 years. As productivity rises, we can make more with the same level of inputs. Demand has to rise just as fast or the economy shrinks. For an economy to be at full employment, demand needs to equal the society’s productive capacity. If it does not, then supply will shrink to meet demand and millions of workers will become redundant. To achieve full employment, we must find a way to instead push demand up to meet the economy’s productive capacity. Since the Great Depression, we have solved this problem of demand three different ways: war[1], rising wages, and debt.


  1. плюс:

    It is important to understand that making bombs and blowing up cities is not what shrunk unemployment. It was the printing of money, the hiring of workers, the creation of demand by deficit spending. Had the US government spent as much as it had on fighting Hitler on promoting the arts, or building schools or even digging ditches and then filling them, it would have had just as beneficial an economic effect as did the war.



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