akuma587 said:
TheRealMafoo said:
akuma587 said:
halogamer1989 said:
Orca_Azure said: 17 billion out of a 3.2 trillion budget :p gotta love that |
3.6 billion for the 2010 fiscal year...
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Actually it is 3.44 trillion.
The budget is going to grow to some degree every year either in real terms, based on the increase in size of the economy and the population of the country, and in nominal terms, based on increases in inflation. So people have to take these numbers with that in mind as well.
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These numbers should grow each year with GDP. Why then when GDP is going to drop 12%, they go up 50%?
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That's your assessment. Many economists would say the exact opposite, that the government's share of GDP should substantially increase when GDP drops for the health of the economy.
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Well, with how many economists were claiming that the housing market wasn't in a bubble in 2006/2007 and didn't see the impending credit crisis until it had already become a massive problem do you really feel confident that economists have a strong understanding of the economy?
The economy really isn't that complicated and, much like a forest fires are needed to have a healthy forest, you must have economic downturns in order to keep your economy healthy. Government intervention to prevent companies from failing is like protecting trees with pine-beetle infestations from the forest fire; in the long run the government is doing more damage because the lack of moral hazard will lead to other companies making the same mistakes without fear of the consequences. Unemployment is like burnt trees that have collapsed on the forest floor, and when the government produces government jobs it is like taking this burnt material away from the forest to make it look neater; but the burnt material is the nutrients that lead to the forest re-growing stronger than it was before, and the unemployment leads to an affordable and motivated workforce which is necessary for the next generation of companies.
The health of the economy is best maintained by the government staying out of the way of people, allowing them to develop the technologies and products of the future, and to encourage them to sell their products to as many people as possible (through free trade).