Both make the same simple error. If you spend X at time t to build a bridge, aggregate demand increases by X at time t. If you raise taxes by X at time t, consumers will smooth this effect over time, so their spending at time t will fall by much less than X. Put the two together and aggregate demand rises.Discussing the same economist I bashed earlier.
I ask, OK, so business and government and households and any other entity can arbirtate between various investment opportunities.
What does he guy say, that could indicate government had better uses for the money than huoseholds or firms? These is missing information, the Keynesian trick, that makes government a better selector of investment opportunities. It is not liquidity, it is not the adoration by Eurpopeans for everything American, what exactly makes the US Congress such a better stock picker at this particular time. The Keynesians aren't arguing their trick pony any more, why?
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