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Replace the word "government" with Microsoft. Why is government spending necessarily non-stimulative but the same isn't true for Microsoft? We get inflation o

Replace the word "government" with Microsoft. Why is government spending necessarily non-stimulative but the same isn't true for Microsoft? We get inflation only if taxes aren't at a later date raised to pay for the new spending. Right now we have very low borrowing costs as a nation. Therefore, if we are ever going to shore up our infrastructure now is the time to do it. It has the added benefit of employing lots of people and causing a stimulus to the economy. Taxes on the wealthy are at very low rates right now and there is no reason to suspect that regressing to the mean of tax rates on the wealthy will have a detrimental effect on the economy in the future.

dnautics 16y ago
Because the government is not productive, (in the marxist sense). To be sure, there are state-owned corporations that are producing real, consumable goods, or infrastructural improvements. In those cases the stimulus may be real, but it raises the question of whether or not (in the case of, say highway spending where there's a clear government imperative) government could be doing the spending in a more measured (and non-panicky) way that correctly responds to need and demand - or (in the case of say, veteran's healthcare, education, public service pensions) whether or not having unlimited balance sheets promotes bureaucratic inefficiency.