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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Road Walker who wrote (271670)	2/3/2006 3:03:36 PM
From: combjelly	Respond to of 1575832

"How long do those people need to be employed before their taxes pay back what it cost in debt to produce the job?" According to Keynsian economics, direct government subsidies have a multiplier of about 3. So each $150k would stimulate economic activity worth about $450k. So the pay back should be pretty quick. Now implicit in that assumption is that the recipient is going to spend the money locally so that there is an incentive to hire people, stock more goods, build housing, etc. There isn't as much of a multiplier if the money is invested locally, it tends to cycle between the same set of hands, or other places, where it goes out of the local system. Whatever the reason, we have a multiplier closer to 0.2 than to 3. In other words, we are throwing money down a rat hole.