Posts Tagged ‘supply side economics’
April 16th, 2011 at 5:52 pm
Return of Supply-Side Economics?

The Economist explains how “The Party of No” is most unified around the theme of being anti-Keynesianism.  Keynesianism teaches that government can grow the economy by spending tax dollars to stimulate consumption (i.e. demand).

Rep. Paul Ryan (R-WI) and other Republicans supporting his “Path to Prosperity” budget argue that cutting taxes gives individuals more money to save and invest in production (i.e. supply), the increase of which creates more jobs.

Not all GOP-ers are sold on Ryan’s revived supply-side theory.  Instead, they prefer to focus on spending cuts as a matter of principle.  Come election season, it isn’t likely that voters will support merely cuts.  They’ll want a vision of what the extra money in their pockets can do.

If recent history is any guide, I suspect Paul Ryan will emerge as the main spokesman for the positive vision of limited government.