The ongoing protests in Madison have me thinking about what government spends money on. And in many cases, it's employing people like teachers, policemen, firemen, social workers, etc.
So what happens when we cut government spending?
The math isn't difficult.
More people on unemployment (and more government spending). Fewer taxes collected. Less money going into the retail sector. Purchasing decisions (new house, new car, new teeth) delayed or canceled.
That's good for our economy how?
I understand the argument that government is spending too much, and I'm sure there are cases where it's true. But too often this argument is framed this way: "We have to cut government spending so we can create jobs!" But that's not what happens at all. You may be saving the taxpayer some dollars. But what you're also doing is cutting jobs, and there's no reason whatsoever to think that the private sector will pick up the slack.
Right now many states are facing big deficits. A good number of these states, like Wisconsin, have Republican governors. So raising taxes is out. Cutting spending is in. And that means job losses, less revenue, and so on. It does not sound like a formula for economic recovery to me.
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