The stimulus on the other hand basically a complete and total failure. The problem is the govt doesnt produce anything so how is it going to stimulate demand?
I understand the idea that if they give money out they can stimulate demand but they are first taking that money from someone else and then AFTER TAKING A CUT distributes that to others to spend. So in effect what we have is a net loss of money, b/c the amount taken away is less than the amount given out when you factor in their cut.
Now the govt does provide services(infrastructure, police, fire etc.) that their may have already had demand there. The bulk of the stimulus werent spent on these and that was the problem. If you build roads in desired areas, businesses see potential store fronts etc. If you have alot of crime you can employee police officers to help stop it. You dont build roads into no where and employee ppl where there is no need.
This is all outside of the majority of the spending which was pet project like bs of course.
