Nathan wrote: ------------- Just to be a bit heretical amongst the heretics, but is the argument for Keynesian deficits very sound anymore in a global economy? If the US government deficit spends, doesn't a large proportion of the spending get sent overseas through imports, thus short-circuiting any multiplier effect? Paul ---- The above strikes me as narrowly nationalistic. If, due to the concentration of income in the hands of the upper classes, there is a world wide deficit in consumer demand, budget cuts in individual countries can only make it worse. Conversely, should fear of revolution again induce higher taxes and government expenditure in the leading capitalists countries as after 1945, then the expansionary effects would affect the world economy as a whole.
