SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Politics : Politics of Energy
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: TimF who wrote (6147)3/14/2009 9:11:51 AM
From: RetiredNow  Read Replies (1) of 86355
 
True, but not all government borrowing is bad. If we borrow to invest in projects that have a high return on investment, higher than the cost of borrowing, then it is worthwhile.

As I've said before, if I were King, the recent recovery act would have still been just as large, but the only things it would have contained would have been projects with a positive NPV with as short a payback period as possible. I've never been for free stimulus with no return like welfare checks.

The same business principles need to be considered when we cut taxes. What is our economy's return on that investment. If we cut taxes today, we know that we'll have to borrow more at the government level and pay interest on those borrowings. So will the return on private investment from the extra money they have from lower taxes more than offset those government borrowings? And at what point will those private sector returns be channeled back to our government to pay off that debt?

We can't forever accumulate government debt to put more money into the private sector. That has the bad consequence of crowding out all beneficial government spending on things like infrastructure, military, police, and other necessary government functions.

A balance has to be struck.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News