Tue, 02/15/2011 - 8:00am - 9:00am
Economist Justin Elardo joins Abe and Joe to talk about demand-side economics.
When President Franklin D. Roosevelt conceived of and executed the New Deal -- his grand plan to lift the country out of the Great Depression -- his work was guided by demand-side economics. The government would spend money to put people to work building roads, schools, bridges, dams, community centers and a whole array of infrastructure projects, many of which are still in use today. In turn, these gainfully-employed Americans would circulate their wages through the economy, creating demand for goods and services of all kinds. The money needed to hire these workers was raised through a combination of deficit spending and taxation of the wealthy, at rates that would be considered scandalous today.