Monday, March 11, 2013
The Sequester that Saved the Economy
http://www.forbes.com/sites/briandomitrovic/2013/03/05/the-sequester-that-saved-the-economy/ Due 18 March 2013. What is the author's point as to why this sequester will save the economy? In his opinion, does Keynesian economics work?? What will work to stabilize the economy?
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In Keynesian economics, increased government spending is supposed to cause a growth in the economy. However, past history has showed the opposite. Shortly before the great recession of 2007, government spending was at an increase of 24%, but our economy continued to fall into recession. This author suggests that a decreased government spending will assure lower tax rates in the future, thus causing more consumer spending. He does not believe Keynesian economics will work, and he thinks that the sequester's spending cuts will cause the economy to stabilize itself.
ReplyDeleteThe author asserts that lower government spending is necessary to get us out of a recession. The sequester, he concludes, will have the unforeseen bonus of being the catalyst which will help the government to reduce its spending. In his opinion, Keynesian economics does not work, as history has proven that this produces the opposite effect of getting consumers to spend, as it frightens them into thinking they'll lose money, causing them to invest. The sequester, in his opinion, and the spending cuts it creates, will most likely stabilize the economy, or at least "take the Great out of the 'Great Recession.'"
ReplyDeleteThe author's point to why the sequester will save the economy is because this may be a way to maintain the Nation's GDP. However, budget deficits make the people believe they will pay more taxes. The author says the spending limitations have created wonderful things in the economy. Tax cuts imply room for the real sector to operate. The author does not believe Keynesian economics would work. Cutting taxes and cutting spending will work to stabilize the economy.
ReplyDeleteThe authors point for stating that the sequester will save the economy is that he believes that less government spending is essential for the economy to recover from the recession we are currently in. With that, he thinks Keynesian economics doesn’t work since our recent history has shown that increased government spending did nothing to stop the pursuing recession from inflicting the country. This is because it causes consumers to want to save their money and not spend it, the paradox of thrift. All in all, he strongly believes the sequester and the resulting spending cuts and lower tax rates will stabilize the economy.
ReplyDeleteThe author's point is that stimulus spending does not work; keynesianism does not work. In the past, spending limitations have preceded to wonderful things in the economy so if our federal government today restraints itself and outlaying other people's money, then our economy would precede to wonderful things! Spending cuts and tax cuts are his answer and the sequester he believes will save the economy.
ReplyDeleteThe author believe's that Keynesian Economics, the idea that government spending will help create economic growth, does not work. As history has proven that this produces the opposite effect of getting consumers to spend, as it frightens them into thinking they'll lose money, causing them to invest.This author suggests that a decreased government spending will assure lower tax rates in the future, thus causing more consumer spending.
ReplyDelete-Jacob Hochman
The article states that Keynesian Economics is the idea of government spending and it will help with the growth of the economy but the author thinks that that idea does not work. The history states that consumer spending is good for the economy but people do not want to spend their money because they are on a budget. The author says decreased spending will lead to decreased tax rates.
ReplyDeleteThe author claims that lower government spending is necessary to get us out of a recession. As history has proven that this produces the opposite effect of getting consumers to spend, as it frightens them into thinking they'll lose money, causing them to invest. With that, he thinks Keynesian economics doesn’t work since our recent history has shown that increased government spending did nothing to stop the pursuing recession from inflicting the country. Tax cuts imply room for the real sector to operate.
ReplyDeleteThe author states that decreasing government spending is a necessary step to aid in our recovery. History has proven that consumer spending is beneficent to the economy, but people do not want to spend money in a time in which they are forced to budget. The author claims that decreasing spending will lead to decreased tax rates. These tax cuts will allow room for the sector to operate.
ReplyDeleteThe author says that he believes that less government spending is prudent for our economy to get over this recession we're trudging through. The author thinks Keynesian economics won't work because our history has shown that increasing gov't spending does nothing to hold back recession. This causes the consumers to save their money and not circulate it through society. Finally, he thinks the sequester and spending cuts, along with the lower tax rates will help our economy.
ReplyDeleteThe author's point in why the sequester will save the economy is less government spending will quicken the rate of our recovery. In his opinion, as well as what we have seen through history, increased government spending has produced nothing but negative effects. He does not believe in Keynesian economics, but rather the sequester's decreased spending and tax cuts to help stabilize the economy because this will create more consumer spending.
ReplyDeleteThe author believes less government spending will help the economy get back on track faster and save itself. He doesn't believe Keynesian economics work because with all the fiscal policy, he doesnt believe there has been a lot of improvement within the economy. He believes in less government spending as opposed to tax cuts in helping the economy move forward.
ReplyDeleteBased on the article, the author thinks that decreasing spending within the economy will stabilize the economy and, in turn, get us out of the recession. This idea is the exact opposite of Keynesian economics. So we can say that the author does not believe that Keynesian economics, the idea that increased spending, will stabilize the economy.
ReplyDeleteThe author's point of view is that Keynesian economics, along with more government spending and tax cuts, will not help the economy, but rather less government spending would. He believes that Keynesian economics will not work with fiscal policy. He also believes that the sequester is what will be able to stabilize the economy, as it reduced much government spending.
ReplyDeleteJaime Caldaro
ReplyDeleteIn Keynesian economics, increased government spending is supposed to cause a growth in the economy. This didn't show true in 2007. Government spending was at an increase of 24%, but our economy continued to fall into recession. This author suggests that a decreased government spending will assure lower tax rates in the future, thus causing more consumer spending.He advocates for the stabilization using the sequester.