International trade/public policy course I teach at Ivey is sufficiently Keynesian. Next time I teach in my course will give students of Arnold Kling on how you think about Keynesian economics-it is brilliant. In particular I find this section useful:
Imagine that all of us were cooks, each with different specialty. In good times, my other restaurants and patronize others patronize me. The economic activity. In recession, for some reason stopped to eat. I don't eat my cooking every meal, but I do not think I can afford to send out. Since I do not protect your restaurant, do you think you have to cut back on eating out, too. Reduced economic activity.
Thinking about the economy in these conditions, the idea of using deficits to boost economic activity makes perfect sense to me.
It reminds me a bit of Paul Krugman baby-sitting scrip history-people stopped using the babysitting scrip, which meant other scrip, no additional decreased which cut back on their use of babysitting scrip and the amount of babysitting.
I believe that Don Boudreaux of money to be taken from somewhere else history (involving the fiscal stimulus cannot function) is not necessarily correct-that money can be horded (such as babysitting scrip). In theory, fiscal stimulus could work if you go the money from being spent to horded. Of course, this does not mean that fiscal stimulus is the best choice-to increase the money supply (or scrip) seems much more efficient,
In General, I believe that taxation is highly inefficient, but my criticism is more practical character.
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