The Deficit creates more Demand than the Economy itself

 

The smashing free market economy has now messed up all aspects. Keynes’s traditional remedy for economic recession is to increase federal spending, which may temporarily create budget deficits. That practice was briefly adopted, but was soon discarded. Since the inflation in the 1970s, everyone has increasingly regarded the federal budget deficit as the culprit, even the Democratic Party economists. Even after the economy fell into the Great Recession, this concept is still difficult to completely overturn. That set of thinking believes that deficits often create too much demand for goods and services, thus pushing up prices. The demand created by the deficit is more than the wages and profits created by the economy tuition in Singapore itself. It requires borrowing to meet demand. Once the demand gap is met, the economy will overheat. The Keynesian school often argues with the Neo-free market school about whether full employment has been achieved and whether economic production capacity has been fully utilised. Some people say that debt financing has pushed up interest rates and made companies more unable to borrow.

If economists are overconfident when doing modern malaise-afire experiments, that argument also underestimates their arrogance. For a science that claims to be "science" in economics, it is really disturbing that economists tend to follow the trend and follow in the footsteps of the American right.

The philosopher Isaiah Berlin classifies a writer who only knows one big thing as a "hedgehog", borrowed from Dina Rodrick, an economist at the Institute for Advanced Study in Princeton That term refers to economists who insist that the economy will self-regulate and the market will efficiently handle various products and services as "hedgehog economists." Freeman and his followers (including many leftist economists) certainly fall into this category, and they are all hedgehogs who are afraid of government intervention.

Roderick also used Berlin's vocabulary to call economists who doubted that the economy would self-correct and knew many little things as "foxes." Fox economists usually want to see regulations more than hedgehog economists. They also hope that the government will invest more in public goods and make more use of unemployment insurance and other social programs to protect workers.

However, the fox in Roderick's eyes is actually a hedgehog. They are indeed more willing to resort to government policies. Most of them argue that when the market fails, the government should intervene to correct the shortcomings (market failure here refers to the output of social welfare, such as but that view is fundamentally ambiguous. "I want to point out the prejudices that the theory itself carries," wrote Richard Nelson, an economist at Columbia University. That is to say, the free market is actually better than other forms of governance, unless the market itself is flawed... The argument is that "we need the government because the market sometimes fails", you If you think about it, you will find that argument is strange, or at least incomplete. Can't we directly claim that the government or the family are inherently appropriate or even necessary?"

There is one characteristic of malaise-afire theory that is attractive to economists:

It is a pure economy, without any tedious details and exceptions. The rise of the new malaise-afire theory was initially to combat the high unemployment and inflation of the 1970s. In some respects, it did succeed. But later theorists wanted to apply the general principles to various situations, regardless of the details of individual situations and events. "New York Times" columnist and Nobel Prize winner Paul Krugerrand once argued that economists must deal with some more "messy" details, but he mainly refers to those who want an ultra-conservative economist who prevents all government intervention. In fact, that warning also applies to moderate orthodox economists, including those on the left.