Popular Conservative Austerity argument Debunked?

[the2real4mafol]

Kasz216 said:

the2real4mafol said:
We need to update our infrastructure more than anything. We still use sewers from the Victorian ages for example and there are still many post-industrial scars that need to be rebranded and reused for something (its depressing seeing so many empty buildings in some areas!). Thank god we got the olympics which put some money in East London. and we also must re-diversify our economy, relying on mostly services can't be good. 

 

Upgrading the sewers is fine and all... that's not going to help the economy though.  Hell you'll probably lose jobs since i'm guessing those kind of sewers run better.

As for fixing post industrial scars... that's exactly what austerity plans are suppoesd to include.   Pro buisness reforms to attract buisness.

Since Austerity is  a lot like cutting costs at a faiing resteraunt.   All it does is buy you more time.

 

If we were looking at it through John Maynard Keynes perspective... Stimulus spending probably actually wouldn't be his first suggestion.   He'd likely find it a waste of money currently.  Why?  The United Kingdoms HUGE trade imbalance.   He would find it illogical to spend stimulus money when a lot of it would end up overseas and would first suggest trying to eliminate the trade balance.   He'd probably want to cut ties with the Euro.  He was for the Bancour, but that was back when the rich countries were the ones with the trade surpluses.

Afterall, how does a demand driven muliplier work, when the majority of the money we buy go back to foreign manufacturers and producers?    You go out an buy a bunch of Nintendo games with your stimulus money, and the majority of your money is going straight to Japan.

What would Keynes want... the government to spend... to give the rich incentives to invest in the USA and UK.

I'd suggest the Economic Consquences of Peace if you have time.  It's free because the publishing rights have expired.  (Oops, in the US.  You may want to check United Kingdom Copyright law before reading)

http://www.gutenberg.org/ebooks/15776

It'd likely give you a fuller understanding of Keynes.  

The sewers was probably just a bad example but they are very old. Stuff like High Speed Rail would probably be more beneficial to the economy.

But the problem is, how can we follow Keynes theory when we wasted all our money from the good times of 1992-2007? It's an interesting topic but very complicated. 

But from what you're saying, each economy needs some amount of manufacturing to succedd, which could be why Germany is one of the least affected in the Eurozone. 

But i'll read the book when i have time