Originally Posted by spence
But that's the rub. Big corporations in general have excess cash they're unwilling to invest because they don't see a return.
"Excess" cash that is held rather than invested for expansion, will lose value to inflation. But if it goes to bonuses or raises in salaries or stock dividends (providing that the business sold stocks), the bonuses and raises and dividends will either be invested or used to buy things, all of which fuels the economy. However, raising salaries with government fiat money can lead to higher salaries than profitable when the fiat money runs out if there is no actual growth in productivity and profit.
For many sectors capital investment goes to automation which further reduces the need for employment.
In a previous post you said that "new technologies born from government funded programs" caused growth. Now you're saying that much investment goes to "automation," which would be a new technology related to a companies production, and that it reduces the need for employment. Which, I assume, is a negative impact on economic growth. But, somehow, if the technology is "born" from a government funded program, then it will grow the economy. Which implies that private investment in new technologies does not grow the economy, or even shrinks it, but government investment in technology will grow the economy.
In total, you seem to be saying that either business will sit on excess cash which loses value due to inflation, or invests in automation which reduces the work force therefor shrinking the economy, or, somehow, if the government provides fiat cash, it will grow the economy, or if government "invests" in technology it will grow the economy, but private investment in technology is either ineffective or will shrink the economy.
Very complex, and confusing.
Of the articles you linked, the heritage piece is just standard conservative philosophy but doesn't take in the complexities of our current situation.
Your assertions are just the standard Progressive philosophy. As I have said, there are conflicting thoughts and analyses re economics and economic forecasts. Not just what you consider uncontested, universally agreed to theories or forecasts.
Progressive economics requires a complex, abstruse theory (exemplified by the complex mess of your above assertions) to justify spending more than the revenue collected, and the necessity to borrow in unlimited fashion in order to fund the Progressive model of government which controls and defines the shape and content of the societal order. All of which requires government command of the economy and ultimately requires government funding of the economy.
Until that ultimate model is in place, programs must incrementally be added in the move toward the desired government command. And, while the private market still funds the government via taxation, Progressive economic theory has to constantly adjust and increase taxation to pay for those programs in ways that give the illusion that they are adequately funded. And those programs require ever new regulations. All of which create new "crises" that must be responded to with even more regulations. Which, in turn, compounds the complexity of the taxing bureaucracy's codes and rates in order pay for new regs and programs and still maintain the appearance of favoring the majority of voters. And thus it can continue to expand the private sector's and its people's dependence on government and its regulations . . . and continue the increasingly complex tax system required to give the appearance of funding that growth.
We have massive debt,
It wasn't "conservative" economic philosophy that created that massive debt. It was various forms of Keynesian economics that created it.
a crumbling infrastructure, an evolving global economy etc... What is the impact of increased leverage in terms of debt service and inflation? Hello???
Infrastructure is addressed in the articles I linked to. "Conservative" economics is in favor of infrastructure. I am not sure that Progressive economics requires anything other than whatever government wishes at any given time. What happened to the promised spending on infrastructure in the Progressive stimulus bill. We are still waiting for it.
"Conservative" economics is all for debt "service" (reduction). Progressive economics constantly increases debt to expand government power. Inflation is necessary to help even paying for the interest on the debt in order to avoid default. But actually paying down debt is of no concern to Progressives.
The other one is more just reform minded but doesn't even support your argument for the most part. I'm not against reform, that's not what is really being proposed right now though.
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