Really, Reagan took taxes away, guess your economics plan is pretty cool though, did you work for AIG? :rofl:

Reducing taxes is also a way to pump more money into the economy, it may also result in increase short term deficits.

Here is some information on the subject:

Keynesian Effect

Following John Maynard Keynes, many economists recommend deficit spending to moderate or end a recession, especially a severe one. When the economy has high unemployment, an increase in government purchases creates a market for business output, creating income and encouraging increases in consumer spending, which creates further increases in the demand for business output. (This is the multiplier effect). This raises the real gross domestic product (GDP) and the employment of labor, and if all else is constant, lowers the unemployment rate. (The connection between demand for GDP and unemployment is called Okun's Law.) Cutting personal taxes and/or raising transfer payments can have similar expansionary effects, though most economists would say that such policies have weaker effects. Which method has a better stimulative economic effect is a matter of debate.
The increased size of the market, due to government deficits, can further stimulate the economy by raising business profitability and spurring optimism, which encourages private fixed investment in factories, machines, and the like to rise. This accelerator effect stimulates demand further and encourages rising employment.
Similarly, running a government surplus or reducing its deficit reduces consumer and business spending and raises unemployment. This can lower the inflation rate. Any use of the government deficit to steer the macro-economy is called fiscal policy.
A deficit does not simply stimulate demand. If private investment is stimulated, that increases the ability of the economy to supply output in the long run. Also, if the government's deficit is spent on such things as infrastructure, basic research, public health, and education, that can also increase potential output in the long run. Finally, the high demand that a government deficit provides may actually allow greater growth of potential supply, following Verdoorn's Law.
There is, however, a danger that deficit spending may create inflation -- or encourage existing inflation to persist. (In the United States, this is seen most clearly when Vietnam-war era deficits encouraged inflation.) This is especially true at low unemployment rates (say, below 4% unemployment in the U.S.). But government deficits are not the only cause of inflation: it can arise due to such supply-side shocks as the "oil crises" of the 1970s and inflation left over from the past (inflationary expectations and the price/wage spiral). If equilibrium is located on the classical range of the supply graph, an increase in government spending will lead to inflation without affecting unemployment. There must also be enough money circulating in the system to allow inflation to persist -- so that inflation depends on monetary policy.


Deficit spending - Wikipedia, the free encyclopedia

Not sure how it got into an econ debate but...


Ramble ramble, I know what deficit spending is, I minored in Economics but thanks :) Keynes was a huge proponent of, what is now, the Laffer Curve as well, which is debated left and right, but at least he got this part right ;)

Again, Reagan got it right. Looks like whatever REP follows Carter (I mean Obama) will have to do it again. Should be fun :tsk: Watch below and learn from history :)

Keynesian Economics Is Wrong The Foundry

Good read on it Scoop: What's Wrong with Keynesian Economics?

And if you just want to read wikis, read this: Reaganomics - Wikipedia, the free encyclopedia

How we got is this discussion is that you commented that Obama increased the deficit.

I pointed out that in a recession (That happen when Bush was in office) the government typically conducts deficit spending. It seems that given your economic knowledge, you understand that and your comments are really nothing but partisan criticism?

:bustingup:bustingup:bustingup:bustingup You really don't understand much do you :rofl:

Go back and read your posts 6 & 9 :rofl:

I don't think you even read what you posted in that Wiki thread, or at least you didn't research it. There are MILLIONS of econ docs written against those 'depression' philosophies. But I guess you didn't actually read it? You can find tons of documents debunking that spending theory, but again, don't think you actually researched it, I think you just wanted to see my comments to you :) That's cool. I have free time today. And you always fall back to a "Bush" or "Partisan" comment line, kinda odd considering I'm a fan of neither :)

Here is the quote, what am I missing?:rolleyes:

Again, didn't elaborate on anything, I stated a FACT :) You just picked a random wiki :)

This is becoming a never ending arm wrestle.

I am Independent and try to take a unbiased approach to politics.

Give Obama a chance he is our President. He seems to be trying hard.
I am not saying he is perfect, but he is seems to being doing ok he seems smart and sure is a smooth talker. I am still concern about his position on taxes but hope that the Republicans can water down his changes in this area. Yes some change is good.

:thud:

Obama: Umm, umm, now, now, now, umm, let's be clear.

And that's WITH the teleprompter. If the liberal media actually fielded him some tough questions, you'd see even more hemming and hawwing.