The mantra of the Obama administration is that we need more government spending in order to stimulate the economy.  Right?  This is Keynesian economics, and clearly we are seeing how well that is working out for us.  We have fewer jobs, bigger deficits, bigger government, and a stalled economy.  This is because Democrats like Barack Obama have a skewed perception of our economy .. they truly believe that money taken out of the private sector and given to the government is equal.  Unfortunately they are wrong.  Here is our economics lesson for today and your answer to your Lib friends when they say that the government needs to spend more to stimulate our economy.  This is from Congressional testimony of Chris Edwards from the Cato Institute:

Let’s take a look at how federal spending damages the economy over the long-run. Federal spending is financed by extracting resources from current and future taxpayers. The resources consumed by the government cannot be used to produce goods in the private marketplace. For example, the engineers needed to build a $10 billion government highspeed rail project are taken away from building other products in the economy. The $10 billion rail project creates government-connected jobs, but it also kills $10 billion worth of private activities.

Indeed, the private sector would actually lose more than $10 billion in this example. That is because government spending and taxing creates “deadweight losses,” which result from distortions to working, investment, and other activities. The CBO says that deadweight loss estimates “range from 20 cents to 60 cents over and above the revenue raised.” Harvard University’s Martin Feldstein thinks that deadweight losses “may exceed one dollar per dollar of revenue raised, making the cost of incremental governmental spending more than two dollars for each dollar of government spending.”

Thus, a $10 billion high-speed rail line would cost the private economy $20 billion or more.

 The truth is that Barack Obama doesn’t have a clue how to grow the economy, so he has just given up.  Instead, he will push for more government spending in order to keep the unions happy and play into his class warfare campaign.