The T
George S. Patton Party
'Disposable income' is fast becoming very rare thanks to Obama and the Statists.Increase consumer spending.
OK, I see the problem.
Let me walk you through this.
Consumer spending does not create jobs. Gerald Ford sent $300 checks to people to help with the recession. It didnt work. George Bush sent $600 checks to people to help with the recession (A Democrat idea, btw). That didnt work either. Obama pushed a stimulus bill that had temporary tax breaks etc to "get money into people's hands" to help with the recession. That didnt work either.
So we've had 30 years of failed policies of government putting money in people's hands so they will spend it to stimulate the economy. They don't work.
They don't work because that money has to come from someplace. That someplace is increased taxes or borrowing. So the money is taken out of the economy before it is put back in. But it isn't an even taking because there is the "toll for the troll" the cost to administer all this.
The gov't is under the mistaken impression that there is a "mulitplier effect" from gov't spending. But the multiplier turns out to be less than 1. Meaning that every dollar spent by the gov't produces less than a dollar of GDP.
What does grow the economy and create jobs are tax cuts at the margin that are permanent, and encourage work, savings, and investment.
If a guy works for $8/hr telling him he can get an extra .05 if he works another hour isn't much of an incentive. If a guy works for $1500/hr the extra $100 will be an incentive. More work means more output, means more demand. And that is how the economy grows. Not by "putting money into people's hands."
Consumer spending does help with the economy, but when people have bills to meet and maintain life they don't spend when the economy is bad they save or pay their bills.