Quote:
Originally Posted by sebastian_dangerfield
It's one guy being able to spend $25 versus another guy being able to spend $0.
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JFC, this makes no sense at all. If the government pays wages to non-union workers, they have money to spend that they wouldn't otherwise.
When the government spends $100 million, that money goes somewhere. It doesn't just disappear. The argument all of you are making is that if you think of the different ways the money can be spent (low, non-union wages; higher, union wages; materials; land acquisition; equipment; salaries to managements; profit to capitalists), of all of them the one that ripples through the economy and has the most cumulative beneficial impact is the higher, union wages. Maybe that's so.
The basic intuition is that money that gets paid to the middle class gets spent again and circulates through the economy, but money that gets paid to the wealthy just gets put in a bank account (where it doesn't disappear, but gets reinvested by a bank with some positive impacts -- just not as much as with wages). I AGREE WITH THIS SO ALL OF YOU CAN STOP EXPLAINING TO ME AS IF I DISAGREE.
Maybe -- maybe -- it's true that middle-class wages are more effective stimulus than lower-class wages, but I doubt it, and if they are it's *not* because the lower-class spends 0. They spend everything they make.
I suspect that the biggest reason why union projects are more effective stimulus is that they are more expensive, and if you think that the government is going to spend whatever it takes to solve given problems instead of spending a certain amount on whatever projects are next in line, then you get more infrastructure spending with union jobs. I agree! I suspect government spending is more often driven by demand for specific projects, rather than Congress's assessment in the abstract of how much to spend in different categories. But that's not an answer to the question I started with, or the comment Sebby made that I reacted to.
