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

To: i-node who wrote (922161)	2/19/2016 12:16:40 PM
From: combjelly	Read Replies (1) \| Respond to of 1570724

Are you pretending to be stupid or do you come by it naturally? Whatever the government expenditures are with respect to GDP has zero to do with implementing austerity measures. Austerity measures are a year over year thing. It can impact the expenditures versus GDP, but in non-intuitive ways. For example, government cuts spending. This cause the economy to contract per very simple economics. This means the GDP is smaller and it means unemployment grows. That means the cost of social services to go up and thus government expenditures. Because both government expenditures go up and GDP goes down, the ratio of government spending to GDP goes up. Which is why your example is pretty stupid. You can't cut your way to prosperity. In principle it might work over the long term, but that has yet to be proven. It very well may hurt in the long term also because the short term loss of economic opportunity can negatively impact long term growth. It is not a complicated concept.