Preview
Preview

Government Spending, Deficits, and Keynesian Economics Essay

:: 4 Works Cited
Length: 1252 words (3.6 double-spaced pages)
Rating: Purple      
Open Document
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

A growing government is opposite to America’s economic interests because the various methods of financing a government - taxes, borrowing, and printing money have harmful effects upon the economy. There are many reasons why there is a high deficit in the United States such as extensive spending. This is true because government spending is often economically destructive, regardless of how it is financed. There are many causes of the steady growth in U.S. trade deficits. There are many people are against the high deficits especially economists.

“Economists define government intervention in the foreign exchange market as the buying or selling of foreign exchange for the purpose of manipulating the exchange rate. “(Case, pg. 398) Economists would agree that there are situations which lower levels of government spending would improve economic growth and other situations in which higher levels of government spending would be pleasing. Economists will generally agree that government spending becomes a burden. Economists feel as though by raising the deficit we are spending money the economy does not. If United States would raise taxes to help pay off the deficit that would not work since so many Americans are out of work. In addition, they believe that raising the GDP taken by the state sector has a negative effect on the growth of the private sector of the economy. Even though the economy could benefit from the budget deficit such as economic growth, the economists do not want to take a chance on that. Also, some economists are also concerned that higher borrowing by the government may also openly result in reduced utilization spending. They argue households recognize that higher current government borrowing results in highe...


... middle of paper ...


...ful spending because it is taking a toll on our future, our children’s future, and our children’s children future.



Works Cited

1. Case. Principles of Macroeconomics, 9th Edition. Pearson Learning Solutions
2. United States Economy - Monetary and Fiscal Policy." Country Studies. U.S. Department of State. Web. 15 Aug. 2011. .
3. Mitchell, Dr. Daniel. "The Impact of Government Spending on Economic Growth." Conservative Policy Research and Analysis. 15 Mar. 2005. Web. 16 Aug. 2011. .
4. Pettinger, Tejvan. "Monetary Policy vs Fiscal Policy | Economics Blog." Economics Help - Helping to Simplify Economics. Web. 09 Aug. 2011. .


Click the button above to view the complete essay, speech, term paper, or research paper








This essay is 100% guaranteed.


Title Length Color Rating  
Essay about Classical Economics vs. Keynesian Economics - My research of Classical Economics and Keynesian Economics has given me the opportunity to form an opinion on this greatly debated topic in economics. After researching this topic in great lengths, I have determined the Keynesian Economics far exceeds greatness for America compared to that of Classical Economics. I will begin my paper by first addressing my understanding of both economic theories, I will then compare and contrast both theories, and end my paper with my opinions on why I believe Keynesian Economics is what is best for America....   [tags: Economics]
:: 5 Works Cited
1187 words
(3.4 pages)
Strong Essays [preview]
Essay about Keynesian Economics - Macroeconomics is the branch of economics concerned with the aggregate, or overall, economy. Macroeconomics deals with economic factors such as total national output and income, unemployment, balance of payments, and the rate of inflation. It is distinct from microeconomics, which is the study of the composition of output such as the supply and demand for individual goods and services, the way they are traded in markets, and the pattern of their relative prices. At the basis of macroeconomics is an understanding of what constitutes national output, or national income, and the related concept of gross national product (GNP)....   [tags: Keynesian model, Macroeconomics] 1668 words
(4.8 pages)
Powerful Essays [preview]
Essay on Divisions of The Field of Economics - ... Micro economists believe it is the forces of supply and demand in any market eliminate any shortages or surpluses in that market. Using Adam Smith's "invisible hand" metaphor, competitive markets will provide the most efficient distribution of resources. Macroeconomics focuses on shifts in the business cycle, and the implications of these movements in economic growth, inflation, recession, productivity, budget deficits, trade deficits, and the value of our currency. Macroeconomists believe that the broader economy, composed of many goods and services will not always self-correct....   [tags: micro economics, macro economics] 1401 words
(4 pages)
Powerful Essays [preview]
Essay on Keynesian Economics - The U.S. never fully recovered from the Great Depression until the government employed the use of Keynes Economics. John Maynard Keynes was a British economist whose ideas and theories have greatly influenced the practice of modern economics as well as the economic policies of governments worldwide. He believed that in times when the economy slowed down or encountered declines, people would not spend as much money and therefore the economy would steadily decline until a depression occurred. He proposed that if the government injected money into the economy, it would help stimulate consumers to purchase more and firms would produce more as a result, in a continuous cycle....   [tags: American Economy]
:: 3 Works Cited
650 words
(1.9 pages)
Better Essays [preview]
The Keynesian and Neoliberal View of Unemployment Essay - Both the Keynesian and Neoliberal era came into existence as an aftermath of both an economic crisis and a war. Keynesianism came after the Second World War when the then neoclassical economy was in crisis. This crisis brought forth Keynesianism with the underlying disbelief in the self-regulating nature of capitalism. The Keynesian ideology believed in increased state intervention to produce economic stability. This policy rested on four policy prescription; full employment; a social safety net; increased labor rights; and investment policies were to be left to private enterprises....   [tags: Economic Theory, Government Intervention]
:: 6 Works Cited
2306 words
(6.6 pages)
Term Papers [preview]
Economics Q & A Essay - 1) The current recession is the longest since the Great Depression in the 1930's. We are still far from a recovery with unemployment at about 9.7% and weekly new jobless claims at 442,000+. In your view, are we about to grow out of the recession or will it continue. In addition to the unemployment data, support your positions with such economic indicators as: new housing starts, used home sales, GDP growth, etc. The current recession or financial crises began in United States of America and created a domino effect of creating instability in the financial markets the world over; the spark of this recession ignited fire around December 2007....   [tags: Economics ]
:: 2 Works Cited
1023 words
(2.9 pages)
Strong Essays [preview]
Essay on The Classical and Keynesian Theories - ... However, the Keynesian Theory says government spending can improve economic growth in the absence of consumer spending and business investment (Differences). According to the Keynesian theory, wages and prices are not flexible. A static price will give a horizontal aggregate supply curve in the short run (Classical and Keynesian Economics). The main goal of the government stimulus was to save and create jobs almost immediately. This was the job of the American Recovery and Reinvestment Act of 2009, also known as the "stimulus package", and was signed into law on February 17, 2009, by President Barack Obama (ARRA)....   [tags: economic studies and analysis]
:: 9 Works Cited
658 words
(1.9 pages)
Strong Essays [preview]
Comparing Keynesian Economics and Supply Side Economic Theories Essay - Comparing Keynesian Economics and Supply Side Economic Theories Two controversial economic policies are Keynesian economics and Supply Side economics. They represent opposite sides of the economic policy spectrum and were introduced at opposite ends of the 20th century, yet still are the most famous for their effects on the economy of the United States when they were used. The founder of Keynesian economic theory was John Maynard Keynes. He made many great accomplishments during his time and probably his greatest was what he did for America in its hour of need....   [tags: Economy] 506 words
(1.4 pages)
Strong Essays [preview]
Essay on The Keynesian Theory - Keynesian Theory The Great Depression can be greatly understood by the Keynesian Theory. It is actually crucial to understanding the Great Depression. To begin, when the Great Depression hit worldwide, it fell on economists to explain it and devise a cure. Most economists were convinced that something as large and intractable as the Great Depression must have complicated causes. Keynes came up with an explanation of economic slumps that was surprisingly simple. In fact, when he shared his theory and proposed solution with Franklin Roosevelt, the President is said to have dismissed them with the words: "Too easy." Keynes explanations of slumps ran something like this: in...   [tags: essays research papers] 461 words
(1.3 pages)
Good Essays [preview]
Essay on Keynesian Revolution - Keynesian Revolution Classical economic theory assumed that a ‘free-market’ economy is a ‘self regulating’ system that continually tends toward a full-employment equilibrium, with optimum economic benefits for everyone. Therefore, the best government economic policy is to ‘excuse itself’ and give utmost freedom to individual enterprise. A key element of the ‘Keynesian revolution’ was its demonstration that these basic assumptions are false, both in theory and practice, and its assertion that, therefore, the most appropriate government macro-economic policy is to view the whole economy as if it were a single huge business enterprise which needs to be managed as one....   [tags: essays papers]
:: 2 Works Cited
1230 words
(3.5 pages)
Strong Essays [preview]