Comments: A New Hunt for the Nuge

how exactly is defense spending "guaranteed to stimulate the economy"?

and I'm sorry, but unemployment benefits can stimulate the economy. If the unemployed don't get benefits, they have no money to spend. If they get benefits, they have money to spend, this money, in turn gets spent buying things, which means production of more things, transportation of more things, and the sale of more things - all of which mean jobs. More jobs means fewer people needing unemployment. But in the here and now, with unemployment close to double what it has been for the last 16 years, unemployment benefits aren't a bad thing.

Posted by KG at February 4, 2009 09:28 AM

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But yeah, I'm with KG on the defense spending part. It's not a stimulus for the economy.

I don't think the unemployment benefits are much of a stimulus either, though. Maybe some but not a lot. The problem is that expanded benefits have to be paid from tax money which also could have stimulated the economy had it remained in private hands instead of being filtered through an expensive bureaucracy. I'm all for cushioning the blow from job loss but there are limits to how much we can and should expand benefits.

Posted by Ken S, Fifth String on the Banjo of Life at February 6, 2009 06:46 AM

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Posted by Leon at February 19, 2009 06:32 AM