Comment Re: Isn't it obvious? (Score 1) 254
Sure, government spending creates jobs. However, excepting deficit spending (which has a different price), the government is spending money that it took out of the economy. That money would otherwise be in circulation somewhere else.
It’s not only a matter of whether the money is still “in circulation,” but more how fast it’s circulating and what the money is doing while circulating. Tax breaks for the poor and middle class are clearly stimulative for the overall economy, as they tend to spend a much larger portion of any increase in cash than the rich.
The rich tend to spend a lower proportion of their marginal increases in wealth, tending to either hoard it or spend it on lavish luxuries that don’t benefit the overall economy as much. Money given to the rich doesn’t circulate as quickly, so effectively decreases the spending and investment in the overall economy.
The country trying to maximize its economic output and median population productivity should be taxing the wealthiest and either giving it to the poor and middle class or using it to benefit those sectors of the population in public programs.
