An economics, investment, trading and policy blog with a focus on Modern Monetary Theory (MMT). We seek the truth, avoid the mainstream and are virulently anti-neoliberalism.
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Sunday, May 26, 2013
Bill McBride — States: Mo Money Mo Problems
Now some states are adding to the problem of demand leakage by saving (running surpluses).
This is an old problem. That is, looks like states may not have actually spent stimulus money over the last few years. See: http://johnbtaylorsblog.blogspot.co.uk/2012/03/in-blog-post-yesterday-paul-krugman.html
To moral is that if the Federal government (or any central government elsewhere in the World) gives money to local or regional governments with a view to implementing stimulus, then central government has got to breath down the necks of local governments to make sure the latter actually spend the money.
This is an old problem. That is, looks like states may not have actually spent stimulus money over the last few years. See:
ReplyDeletehttp://johnbtaylorsblog.blogspot.co.uk/2012/03/in-blog-post-yesterday-paul-krugman.html
To moral is that if the Federal government (or any central government elsewhere in the World) gives money to local or regional governments with a view to implementing stimulus, then central government has got to breath down the necks of local governments to make sure the latter actually spend the money.