Posted by examinerebb on 3/4/2013 7:04:00 PM (view original):
Your assumption is predicated on either:
a) the government spending enough to create enough jobs to get us to 5% unemployment
b) there being some other plan in existence, that none of us are privy to, to create those jobs
c) we do it indefinitely in the hopes that, someday, a plan exists to create those jobs
I can't see how Option A happens. It would require either a back-breaking amount of revenue from the current wage earners or an increase in the national debt so steep that the interest payments become overly cumbersome as rates rise with an improving economy. So I would assume it's Option B or C, in which case we're (among other things) back to fixing the housing market.
The point isn't that the government fixes the economy by itself. It's that the government spends enough to fill the hole while demand is low, propping up the economy until it's rational for individuals to fill it themselves, and then scales back and addresses the deficit.
If Apple decided, **** it, we want to spend a billion dollars hiring more employees, you'd agree that that would have a positive effect on the economy, correct? Those new employees now have paychecks that they spend etc., etc. etc..
Is it somehow less positive for the economy if the government decides to spend a billion dollars hiring companies to repave highways? Those construction workers now have paychecks that they spend etc., etc., etc..