Gotta correct Vodkapundit’s drunken math

by Smitty

Vodkapundit uses some Drudgereport links as a launch pad for discussing BHO economic policy, emphasis mine:

Some of us have been warning you about this since before Obama was even sworn in. Look, stimulus spending can’t work, because of one of three things happens:

  1. That extra spending means extra taxes which means the whole thing is a wash. (Government spending having some “multiplier” effect unknown to consumer or business spending is a big, fat lie.)
  2. That extra spending means extra debt, which drives up interest rates, which chokes off growth.
  3. That extra spending means extra money being printed, which means inflation which means any growth is illusory.

It is not a “big, fat lie” in the slightest. You can easily have a coefficient that is < 1. Maybe in a government context, it would be better termed an “inefficient”, but that doesn’t negate its life, any more than lack of a birthday negates the life of an infant.
The Other McCain–keeping the math real since 31Feb08

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