Does Keynesian Economics Really Work?

[Eddie_T]

Is the government the real problem? This is from Does Keynesian Economics Really Work? - ProfessorBainbridge.com

Does Keynesian Economics Really Work?

The Hill reports that:

House Democrats this week have amplified their calls for new spending on infrastructure and other federal projects in the face of May's discouraging job-creation figures.

Obama's been doing that since 2008, inflating the national debt massively and running unprecedented deficits, and the economy still sucks. As Tad DeHaven observed last year:

That the stimulus did create jobs isn't in question. The real question is whether it created any net jobs after all the negative effects of the spending and debt are taken into account. How many private-sector jobs were lost or not created in the first place because of the resources diverted to the government for its job creation?

Don't expect the administration's economists to attempt an answer to that question any time soon.

Here's another question that the administration would prefer to ignore: How many jobs are being lost or not created because of increased uncertainty in the business community over future tax increases and other detrimental government policies?

The economist Robert Higgs coined the phrase "regime uncertainty" to describe Franklin Roosevelt's anti-business climate, which prolonged the Great Depression. Unfortunately, this president is repeating the same mistake.

Health care mandates, cap-and-trade legislation, new financial regulations, union protections, and the probability of higher taxes to pay for the administration's debt spree have caused innumerable businesses to remain on the sidelines.

As one small business owner recently told me, "I want to hire but I'm afraid the administration's policies are going to force me to turn around and let them go."

So maybe government really is the problem:

"If you talk to job creators around the country like we have, they?ll tell you all the over-taxing, over-regulating, and over-spending that?s going on in Washington is creating uncertainty and holding them back," House Speaker John Boehner (R-Ohio) said at a press conference Friday.

[RedJeepXJ]

so again another post of "this could be bad because someone says so...." and the only ones creating uncertainty has been the republicans that want to stonewall everything instead of voting on it...

the problem right now has practically nothing to do with what is mentioned above, we need demand, and the way to get that demand is NOT to take away more money from the middle class as those policies you want would do.

[mathurm]

i know this is an old post, however 'creating demand', when that demand isn't based on the desire of the consumer will create bubbles.

the housing bubble is the perfect example of this. the government intervened passing laws like the community reinvestment act which created a forced demand for houses. we know where this ended up.

another example of keynsian failure is with green technologies. solyndra etc... GM had a failing business model so instead of letting them fail and restructure their company the government bought them and forced them to make such things as the chevy volt.

the volt is a dismal failure and has as much as 250,000$ per car of federal subsidies behind it... who pays for that?

we are taking money from the taxpayer at a huge rate to recoup only 41,000$ per car... this is the stupidest idea for a business model, it will ultimately fail when that subsidy can no longer be provided. and who pays for that?