Once upon a time, President Obama was a traditional Keynesian. When he came into office, he favored a massive injection of new government spending into the economy in the name of “stimulus” — counter-cyclical federal activity aimed at offsetting depressed consumer demand emanating from a recession-battered private sector.
Unfortunately for the president, that approach to economic revival has now been thoroughly discredited in the public’s mind. The problem with Keynesianism isn’t the theory; it’s the practice. What happens in the real world — that is, the world in which Congress drafts and passes legislation — isn’t a series of tidy, one-time, highly valuable public investments that would not have occurred were it not for the legislation.
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