Since the beginning of the economic crisis in 2007, Keynesianism is back into fashion. One of John Maynard Keynes’s central ideas is that when you find yourself in a crisis or a recession, the best solution is to increase government spending. Government spending will sustain overall demand, put everyone back to work and kick-start the economy. The New Democrats and the Liberals are strong proponents of this theory.
Even if you already have a high level of accumulated debt, it doesn’t matter. The solution to too much spending is more spending. The solution to high levels of debt is more debt.
There is something fundamentally wrong with that. Read more