The Deficit Is HELPING the Economy, Not Hurting It, David Levy Says

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2 Responses to “David Levy: Deficit Spending Is HELPING (not Hurting) the Economy”

  1. Deficit spending is the U.S. government’s method for adding money to the economy, which is stimulative. Don’t know why this is such a mystery. Every depression and most recessions in U.S. history have come on the heels of deficit growth reductions; every recovery has come with deficit growth increases. Think. Doesn’t that tell you something?

    Money is the lifeblood of an economy. A growing economy needs a growing supply of blood (money). Deficit spending increases the money supply. Doesn’t get much simpler than that.

    Oh, and by the way, federal “debt” is the total of outstanding T-securities. To stop debt growth, simply stop creating T-securities.

    Rodger Malcolm Mitchell

  2. EdR77203 says:

    The point of taxation is the point of spending. It is not possible for the government to spend money with0ut taking is out of the economy in some form.
    The first form is direct taxation. This accounts for the 2.1 trillion dollars that the government collects in tax receipts.
    The second is in the form of borrowing that we the taxpayer have to pay back or that the lender, in this case the buyer of US Treasury bills, will lose principle on.
    The third way is to print money. One of the functions of money is to store wealth. Printing money dilutes that stored wealth. Printing money takes wealth out of our savings and it takes wealth out of any money that is owed to us in our pensions, annuities, social security and so forth.

    If I were in debt like the US government is in debt, spending more money might make me feel good for now. It will only make things worse in the long run. Just because the US government is bigger and can play let’s pretend that it is not a problem longer than I can does not mean that this can continue forever.

    Government spending is a burden to the economy. For the economy to do better it must be unburdened. Stop the “stimulus”. The stimulus model does not work.