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How does gov't spending grow the economy?

I see this logic alot from libs. How does it work when every dollar injected into the economy must be taken back out in the form of taxes. gov­ernment spending "stimulus" simply redistributes existing incom, dand does NOTHING to increase produc­tivity or employment, so, nothing to cre­ate additional income. And alot federal spending weakens the private sector by directing money toward less productive uses and weakens income growth
Please explain how it works otherwise.

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Asked by Carpy at 11:16 AM on Feb. 2, 2010 in Politics & Current Events

Level 39 (114,053 Credits)
Answers (8)
  • All I see is that it grows government and doesn't provide an appropriate return on the investment. Even if you consider the short term projects, sure you will have people working a job building a road. Until the road is finished. Then what? And meanwhile you have dedicated all of that money into building the road and all you get back for it is payroll taxes. The money doesn't grow. Unless of course you make that road a toll road and charge people twice (through taxation and through tolls) for the project. But that's not exactly making that money grow the economy as much as it is ripping off the constituency.


    Answer by Anonymous at 11:22 AM on Feb. 2, 2010

  • I always thought it seemed like it was robbing Peter to pay Paul...the problem being there aren't enough disciples to sustain it.

    Answer by yourspecialkid at 11:28 AM on Feb. 2, 2010

  • the government spend has reached a point where it is NOT GROWING the economy its HURTING it

    Answer by sati769leigh at 11:42 AM on Feb. 2, 2010

  • OMG, sati. I think that is the first thing you have said that I agree with.

    Answer by Anonymous at 11:45 AM on Feb. 2, 2010

  • Obviously im no big Obama supporter ;p there is only one thing he has done that I can agree with and that is sending some protection out against Irans crazy nut job leaders threats..

    This spending I do not understand at all how it can help thus far it has not help except to ensure that we and our children and so on will be paying for the debt for eternity...and as anon stated it has grown government period.

    Answer by tnmomofive at 11:45 AM on Feb. 2, 2010

  • If government creates jobs within its own sector, it puts ppl to work., but in order the economy to be stimulated for the long haul, the jobs must be for the long term..PPl who work make money and buy items with those earnings. When homes and cars are bought, other ppl are put to work and earning money, which they can now spend on items and services. The biggest issue I see is there are few well paying, benefit providing, long term jobs available. Big Co's are finding it more cost effective to move out the US where labor is dirt cheap and benefits null. Small Cos here can not compete and more jobs are lost. we have to think globally-


    Answer by Sisteract at 12:22 PM on Feb. 2, 2010

  • I agree with Sati.

    Answer by mancosmomma at 12:55 PM on Feb. 2, 2010

  • The govenment doesn't make a profit. It doesn't produce a product. It just administrates the laws of the land and provides protection of the citizens. PreBO is banging his head against the wall over and over not understanding why nothing is happening and why his head hurts. You know what is so good about banging your head against the wall? If feels so good when you stop! When will he stop?

    Answer by jesse123456 at 7:45 PM on Feb. 2, 2010

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