Economic Views
Mainstream economics mainly advocates a cyclically balanced budget, arguing from the perspective Keynesian economics that budget deficits provide fiscal stimulus in lean times, while budget surpluses provide restraint in boom times.
Alternative currents in the mainstream and branches of heterodox economics argue differently, with some arguing that budget deficits are always harmful, and others arguing that budget deficits are both beneficial and in fact necessary.
Schools which often argue against the effectiveness of budget deficits as cyclical tools include the freshwater school of mainstream economics and neoclassical economics more generally, and the Austrian school of economics. Budget deficits are argued to be necessary by some within Post-Keynesian economics, notably the Chartalist school.
- Larger deficits, sufficient to recycle savings out of a growing gross domestic product (GDP) in excess of what can be recycled by profit-seeking private investment, are not an economic sin but an economic necessity.
Read more about this topic: Balanced Budget
Famous quotes containing the words economic and/or views:
“Three factors—the belief that child care is female work, the failure of ex-husbands to support their children, and higher male wages at work—have taken the economic rug from under that half of married women who divorce.”
—Arlie Hochschild (20th century)
“Meek young men grow up in libraries, believing it their duty to accept the views which Cicero, which Locke, which Bacon, have given, forgetful that Cicero, Locke, and Bacon were only young men in libraries, when they wrote these books. Hence, instead of Man Thinking, we have the book-worm.”
—Ralph Waldo Emerson (1803–1882)