The G.I. Bill, and the Interstate Highway System are two excellent examples of the kind of payoff investing in the economy brings.
@joeBishop866
9 жыл бұрын
+Kenatius Except that more debt and more spending will not produce another GI bill, or another highway system. It will simply be another 50 Solyndras. I notice that the only example of productive Government spending you can come up with is 60 years old... The money had to be taken out, before it could be put back in - so Government spending always fails to stimulate the economy. Always has, always will. The first time it was tried on this scale created the Great Depression. Obama has managed to create a similar disaster with his incompetence and fantasies.
@eddieasher9123
9 жыл бұрын
+Joe Bisesi ..... The government can magic up money on a whim, the Wall St bail out was not a result of anything being produced except a few hits on a keyboard.
@Hirnlego999
9 жыл бұрын
+Joe Bisesi Yes, so the Marshall plan didn't do anything then did it not? In fact, the countries which invest into various areas do much better than those that do not. Corporations in countries where the government does not invest in schooling, health, infrastructure, leisure or even corporate support will quickly fall behind. And social security keeps about 20 million people out of extreme poverty. Imagine taking this way, how would these people run their daily lives? Heck, you'd have elderly people breaking laws simply to make it to the next day. And you'd have tons of other costs, as you would if you failed to have a government which cannot even educate its people. A laissez faire capitalist system would not care or could not even make it happen. But at least it could put those kids to damn work and then they can enjoy their "freedom".
@williamfrancis5367
6 жыл бұрын
" Government spending always fails to stimulate the economy. "- Clearly you are historically illiterate.
@MrMarinus18
Жыл бұрын
But also money isn't everything. The US is supposedly the richest country in the world so shouldn't the suggestion that it can't afford to take care of it's own people be seen as a massive insult? I feel more people should react to suggestions of austerity with indignant outrage. That they say "Are you suggesting the US is too pathetic to take care of itself?". If you listen to people constantly preaching austerity you would think they were talking about Niger, or central Africa or Ethiopia or Tatjikistan or some other country like that. If the US had a gini coefficient of 0, meaning the wealth is perfectly equally distributed every single American would own over 30 million dollars. That's just how big the American economy is. The reason the vast majority of people don't even one 1 million is because the wealth is hoarded by the ultra rich.
@Hirnlego999
9 жыл бұрын
4. Save money on the good days for the rainy days.
@guiller2371
6 жыл бұрын
Hirnlego999 If you save in austerity, the money can devalue. It's better to invest wisely.
@danielhalm5792
5 жыл бұрын
Good idea, but doesnt happen- in the government money is never saved, only spent whenever. If it continues deficit will increase until the numbers are really concerning
@TomLynch
8 жыл бұрын
I agree 100% but good luck convincing the deficit hawks. The other missing piece in the deficit equation is the balancing assets. As long as you assets (natural resources, labor, etc.) exceed your debt you have the ability to pay so a deficit remains a viable tool to stimulate the economy. Deficit, GDP and assets - keys to the economy.
@ancelgray
8 жыл бұрын
Robert, You forget mention that you deficit spend during recession, BUT YOU RUN A SURPLUS doing booms. This never happens. The last time the U.S. had no debt was during the presidency of Andrew Jackson.
@justinbeagley5151
8 жыл бұрын
true - but if reagan had continued FDR's policies and high tax rates, then the ratio of debt to GDP would have continued to decrease as it had for years, and by the time W. got into office, we could have started paying off the debt. 70% of which is domestic debt - so it would just be going back to us citizens anyway.
@ancelgray
8 жыл бұрын
Another thing to consider is that the "Almighty Dollar" will cease to be the world's default reserve currency soon. We can get away with "printing" 80 BILLION dollars per month(!) while we can spread that inflation around the world! But after we cease owning the world's reserve currency, that kind of money "printing" will start rapid inflation, and drive up interest rates (not good when you owe $17,000,000,000,000 !!!!). Just think, at 10% interest, that would cost us $1.7 TRILLION in interest! At 5%, that would cost us $850 BILLION in interest. Are you starting to see the picture?
@wondermuttperez255
5 жыл бұрын
Actually, the 90's had a shrinking deficit. It was such a new concept the deficit counter had to be updated to run backwards. The surplus was blown out again under Bush Jr. and hasn't been re-established since.
@olov244
9 жыл бұрын
and the biggest thing in my opinion is, the other option, doesn't pay the debt down, it just puts us in the same hole but with a lot lower return
@idomake4429
8 жыл бұрын
Robert, if you ever decide to give up economics, you have a great future as a cartoonist!
@DaytakTV
8 жыл бұрын
Sanders/Reich 2016!
@Glennyco
8 жыл бұрын
+KZitemExplorer Might as well be dumb and dumber!
@Nin10do0014
8 жыл бұрын
+KZitemExplorer Sanders/Elizabeth Warren 2016 and get Robert Reich as the Secretary of Labor again!!
@TomLynch
8 жыл бұрын
+Nin10do0014 We need Sen. Warren in Congress where she can continue to fight for the policies of the Sanders' administration.
@TomLynch
8 жыл бұрын
+Glenny Co name calling? Really? How rude! How old are you? That's your best counter argument? Sad, real sad.
@raysbagels
8 жыл бұрын
+Tom Lynch You don't expect Dumbest (Glenny Co} to say anything intelligent, do you?
@frankx8739
5 жыл бұрын
Those who have power are concerned only with THEIR economic interests, which are in conflict with the interests of the majority.
@emperorpicard4901
2 жыл бұрын
The problem with all 3 arguments is that Robert does not make a distinction between good and bad spending. Saying that "Spending is good for employment", well spending on what? Spending to hire a million people to dig useless holes may hire a million people, but its a waste of work because nobody needs those holes. Eventually investors will catch up and pull their investment, which leads to another recession and we are back to square one. The reason why cutting spending "shrinks the economy", is because you have a rearrangement from bad spending to good spending. Its not actually shrinking. As the Inventor of GDP stated, Simon Kuznets, mentioned, do not use GDP as an indicator of economic health. Basically, all the arguments are dumb because of a bad assumption that Gov spending is good spending.
@guiller2371
6 жыл бұрын
I love this video! Thanks
@SKEptic-mg2dd
5 жыл бұрын
Glad to see you agree with Mark Blyth.
@joshmaeder8897
6 жыл бұрын
There's a lot of broken windows in this video.
@jeffreycheng5984
22 күн бұрын
Austerity worked in the UK.
@elgracko
9 ай бұрын
Got fooled, again in 🇪🇨, gracias FMI!
@dieselwalter
9 жыл бұрын
All fine and good, but the the profits this country is making are going to the top, and they ain't letting it go. Your concept is plausible, but does not count for greed and corruption of the system.
@kenmills3401
8 жыл бұрын
+dieselwalter Why are rates of profit high?
@mfgJoseph
6 жыл бұрын
How come deficits only matter as a percent of GDP? Debt payments come from tax revenues, not from GDP. What if you have a high GDP and low tax rates (thus low tax revenues)?
@sail1999
6 жыл бұрын
Do we cut spending on education and infrastructure when unemployment is low?
@musicaficionado3805
7 жыл бұрын
Deficits are not meaningless. It leads to capital consumption and malinvestments the more we do "stimulus" and deficit spending. Capital accumulation leads to wealth not spending. The spending done by government is an opportunity cost of consumer spending and saving by the private sector. It is at a cost what of consumers really want and leads to a loss of jobs in the private sector of the economy. A man can get paid to dig a hole and fill up back again but it's a waste of resources.
@williamfrancis5367
6 жыл бұрын
Last time I checked consumers like high quality public services free at the point of use, investment in R&D and good quality infrastructure.
@ymi_yugy3133
6 жыл бұрын
More government spending usually means higher tax rates. Why would the government spending the money help grow the economy more than consumers and businesses spending it. The statistics I found show an uprise of the debt as share of the GDP, albeit leveling out in recent years. And isn't the debt only currently feasible because interest rates are really low. One could argue that interst rates will rise and our current investments prevent us from making investments in the future.
@wijakeak47
7 жыл бұрын
the thing about this is, most of the spending proposed is permanent entitlement spending that means that the spending will help the economy for a short while but then will stifle the recover further down the road. What robert is saying is technically true but it really only applies to very little of the current administration's policies, they should be focused on building bridges, roads, and Schools (in our country not iraq) . A BIG THING HE DIDN'T MENTION IS THAT ALL OF THIS IS ONLY TRUE IF YOU DON'T RAISE TAXES Though the big thing about what he said is % of gdp currently our debt is increased at a huge rate and our GDP increase IS BASICALLY 0
@JonatasMonte
7 жыл бұрын
Most governments don't bother about deficits because by the time it starts to bother the economy they're not around anymore, also it's way easier to keep spending when it's not your money, it's like using a credit card.
@wijakeak47
7 жыл бұрын
JonatasMonte YEP
@pixelmartyr8532
2 жыл бұрын
This job creation mentioned doesn't contribute to the countries ability to fill the hole. Public service people do not generate wealth. They consume it.
@jessejames465
6 жыл бұрын
Respect. This movement is on the right track to raise consciousness
@Crypto_Jeff
5 жыл бұрын
In regards to spending investments made towards - Education. Unless there is a return on investment then the spending is unjustified. If the Federal Government continues to invest in peoples education that does not produce a job that earns a paycheck to where they can pay that student loan back, and on top of that, produce tax revenue for a foreseeable time then once again the "juice is not worth the squeeze". The Federal Government should ONLY issue out student loans for Degree's that have a proven track record for producing both results, and also to students that have a high enough GPA that proves they can hack the college courses needed to "finish" the degree. The Goevernment waste too much money on degrees and people that do not produce.
@MP-db9sw
Жыл бұрын
Capitalist, slave owner thinking. The idea that money is the pinnacle aim of education is ridiculous. And our exorbitant student debt fiasco is the consequence of poor regulations on the exploitative practices of banks.
@2istedanimator
Жыл бұрын
...and you will be fooled by Robert Reich!
@rbj5767
Жыл бұрын
‼️🇺🇸💔💔💔💔💔💢
@10Sethg
8 жыл бұрын
Someone who is supposedly really intelligent just told me that basic economic principles don't apply to the government. We can endlessly spend money and take on debt. If we ever have a problem the solution is just to spend more money. duh!
@ph11p3540
5 жыл бұрын
To a point. If the debt reaches past a critical percentage of GDP then international bond rating institutions apply a higher interest rates to a government. When interests go beyond a certain critical mass then the government has less tax revenue to allocate for programs because they have to allocate a higher percentage of money to debt interest servicing. This causes their available funds to shrink.
@gabbar51ngh
3 жыл бұрын
Only a buffoon would say deficit is meaningless. While I understand his arguments against austerity but to claim the government should just keep on spending is dumb. Whenever government spending is cut you need to remember that you are essentially cutting a supply of money into the economy as well which is what causes the shrink. The solution is to keep supply of money into the economy to balance it out and this can be done through lowering interest rates and decreasing taxes in tandem to cutting government spending. Since over longtime low taxation and low interest rates could cause inflation, you can simply increase the interest rates later once the effects of lowering government spending has been taken care of Now you have smoothly lowered the government spending without losing any jobs.
@theawesomedude1212
8 жыл бұрын
Watching this video makes me think that literally no one on the left has ever heard of some of the most basic economic principles or fallacies.
@justinbeagley5151
8 жыл бұрын
reading comments from capitalists about reich's videos makes me think that the only thing capitalists can say in defense of their policies is that people on the left don't know basic economics. There's a reason why economists are 3 times more likely to vote democrat than republican friend... i'm pretty sure it's not because they don't know how economics works.
@Andarovin
7 жыл бұрын
Well, neo-statist/socialist policies don't require a particular complex rebuttal nor does capitalism require a robust defense. It's called HISTORY. Free market capitalism won and won big in the U.S. and in other parts of the world (Hong Kong, Chile, etc.) Socialism failed. Miserably. The brightest and literally only positive examples of socialism are in Scandinavian countries which had free markets and less government control for decades before shifting into their current state of planned economic malaise...but who wouldn't want a 60% tax and no ability to become economically prosperous? And actually the REASONS economists vote liberal is because they're liberal to begin with: www.forbes.com/sites/timworstall/2016/08/02/surprise-70-of-economists-support-hillary-not-trump-but-70-of-economists-are-democrats-anyway/#112d6b36d67c .
@alexturlais8558
6 жыл бұрын
Andarovin So your argument is economists vote for leftists is because they're leftists? isn't that just arguing that leftism is better? and hong Kong is massively capitalist.
@TeddyLeppard
9 жыл бұрын
Reich is ridiculous. The government is not something in which you get a great return on your investment, it's more akin to throwing money at the Titanic in hopes it will fix itself. Meanwhile, the high-rollers on that boat have walked off with the jewels and furs and taken the lifeboats to safety.
@justinbeagley5151
8 жыл бұрын
You realize that he said that the money spent should go towards good investments like building roads, and investing in education, research and energy right? So no - it's not akin to throwing money at the titanic. It's akin to throwing money at researchers to figure out how to build a more indestructible fault-tolerant titanic in the future, and throwing money at rescue workers to save people from the drowning ship, and pay police and investigators to track down the people who stole the jewels. But there's no point in arguing this - you sound like a libertarian... everything that comes out of your mouth is to blame government - because you don't understand how government is supposed to work, you just blame it for everything
@vickypaulson9264
6 жыл бұрын
Every Republican President seems to do this, in history of our nation.
@joeBishop866
9 жыл бұрын
Wow. He's absolutely wrong on every point. Government spending does nothing to stimulate the economy, and has a 100% failure record on that front. You'll notice the "always spend more" kooks never give an example of when it worked. The assertion that Greece's troubles are caused by insufficient spending is completely contrary to reality. Over spending is the cause of their troubles. Remember that: if they had been running balanced budgets none of their troubles would be happening. If RR were right: wouldn't the previous spending spree have made them rich? Why didn't it "stimulate" then? Third, the current administration is focused on green nonsense and corruption. That is not an investment. Solyndra only stimulated the economics of 3 billionaires, like the 21 other busted green companies DOE gave away. And college for many, many people is an expensive waste of time - not a productive investment. Reich will always say we need to spend more, because that's what he's paid to say. In the nineties, he said we must spend more or growth might stop. Now he say spending more will make us rich. If that were so... the $8 trillion of new debt should have given us unparalleled economic growth, but instead we have stagnation. He talks about the return on investment - but the money was TAKEN AWAY from profitable investment to be burned up in inefficient government make-work. Reich is too blind to understand that the money had to be taken OUT before it could be put back into the economy. A "Broken Window" economic fool. If gov't spending stimulated the economy - Obama's insane spend and borrow spree would have made us rich. The opposite has happened. Facts are stubborn things.
@eddieasher9123
9 жыл бұрын
+Joe Bisesi LOL... how divorced from reality can you get
@Hirnlego999
9 жыл бұрын
+Joe Bisesi No, he's not saying that it will make richer, he's saying the austerity economics make the bad economics worse, as we have seen in Europe. The idea is to stimulate the economy in bad times...and I assume that Reich would agree that it would be wise to save money on better days for the rainy days, which will always come. The broken window example is idiotic, because the idea is not to break something which works, it is to build up in areas where there can be improvements. USA could for instance invest largely in better IT-infrastructure, and that would benefit individuals and corporations alike. Second, infrastructure in general wears down with time, it needs financing from time to time, even during the Bush years a report said that up to 2 trillion dollars is needed to restore a crumbling infrastructure, but as said, it could be used to make it better in the same sense that a corporation could make its productivity better by changing older tired computers to newer fast ones, which more easily keep up with even more advanced software. USA is not in stagnation, the problem is instead that those who make money are almost exclusively going to the top, despite the fact that the working class is making sure the rise in productivity happens in the first place, so they get a bad deal, that's a problem of distribution and will be even more important once the second digital revolution happens... a vast increase in productivity but it will largely go to the top. The debt would probably not have happened without Bush steering the economy down the gutter, had for instance Obama taken over after more reasonable Gore or Clinton then the chances are quite high that the national debt could have already been paid. Wall street is breaking records, and part of how it creates efficiency is actually through things like firing people, to lower cost and shipping jobs abroad. The main goal is money after all, but governments nor people do not only have the goal to make money.
@TheLastProphet11
9 жыл бұрын
+Joe Bisesi " never give an example of when it worked." lol we have used every single time to get out of a depression and recession numbnuts... also who said anything about making us rich? govt spending stops/helps economy from going/staying in a complete shit hole. And it has done exactly that. GDP 2009: 14.9T 2015: 16.3T Unemployment Sept 2009: 9.8 Sept 2015: 5.1. U and Eco no work so good together... caveman think but no know nothing.
@bugabudon
8 жыл бұрын
+Joe Bisesi I hear this Obama big spending thing all the time from Republicans, but they won't say what they are talking about. Obamacare is paid for; the TARP has been paid back, as have been the Auto industry loans and the deficits are far less than under Bush and they continue to fall. The Social Security trust fund is not filled with IOU's. They are called "Treasury Bills" and they are the wisest and safest possible investment for a retirement insurance plan. If we would spend more on infrastructure we'd have less unemployment and more taxpayers. What hasn't worked over the last 40 years is "trick down" supply-side economics. While you are right that Greece was spending too much and needed to reform, the austerity campaign they engaged in caused more problems than it solved. This is not just Reich's view, its the view of lots of economists. Greece is a special case because it is a relatively poor country. We, on the other hand, can afford to do everything we have to do, we just don't want the rich to pay taxes, so we fall back on austerity....... which will kill us. We hear "The government should be run like a business, or a household." That is simply ignorant. RR is right on every point.
@PoliticalPlayer
8 жыл бұрын
"Government spending does nothing to stimulate the economy" he says on the military-created Internet.
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