One could argue that government stimulus programs, including unemployment insurance extensions, resulted in greater iPhone sales over the past three years than otherwise would've occurred... Therefore the theory (Keynesianism) that promotes government intervention [to boost consumption] as the best method of aiding a weak economy has indeed been proven... Right?
Question: Was there demand for cell phones before the first one was produced? Were consumers lined up outside Ma Bell's door at the crack of every dawn to get first crack at the first mobile phone? Or was it the foresight of some genius and the audacity [and capital] of some tech firm that brought the first cell phone to market?
The age-old debate, supply-side vs demand-side economics, rages on... Those who would advocate direct government intervention (deficit spending) during an economic contraction make the, at first blush, logical case that handing out money to the populace stimulates spending, which stimulates production, which stimulates jobs, which stimulates the economy back into the black... The all-wise Nancy Pelosi even stated "those unemployment checks are the best possible form of stimulus", or words to that effect...
Those (of us) who would advocate no stimulus programs, but rather producer (supply-side) incentives (such as lowering corporate and capital gains tax rates), make the case that the chicken indeed precedes the egg... That rather than budgeting a $trillion-five annual deficit (resulting in a culture of dependency that, once established, is virtually [politically] impossible to reverse), simply cut taxes (across the board even)... Thus leaving capital in the private sector, where the market determines its allocation... If we'd done that, I assure you, I would not have had the material to post yesterday's Time To Break Out the Bongs, and untold $$$,$$$,$$$,$$$'s would've funded the production of goods of real value for a growing workforce...
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