Counter-cyclical policy or economic growth??

We know that the PPC shifts outward causing the LRAS to shift outward if there is less
consumption and more saving for private investment in capital goods today. Sources of
savings are households, business and corporations, and government surpluses. We will
find that government deficits cause the government to sell bonds and absorb savings to
finance government expenditures. This means less private sector investment in capital
goods today and higher interest rates. If the counter-cyclical tax cuts made in response
to recent recession in early 2000 are made permanent as congressional Republicans are
attempting to do, will private sector growth suffer as a result?


thoughts?

Answer:
BIG BUSINESS MAKE BIG BUCKS = PAY BIG CORPORATE TAX = FEDERAL DEFICIT GOES DOWN

Consensis: Capitalism works well in a Democracy

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