DEFICIT SPENDING

Deficit spending

Reducing unemployment through Deficit Spending

The idea of having a balanced budget is disputed by the ideas of Keynesian Economics. Keynesian is an economics model which predicts that in times of reduced demand and high unemployment a shortfall will not cost any thing. Instead an unemployment would allow more persons to work, expanding productivity. A deficit does this because it is invested into the finances by government.

For example if the government expends deficit cash on new main roads, trucking will advantage and more jobs will be produced. When an financial scheme is in recession all of its resources ...