Kangaroo Writes Blog

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January 18, 2009

Injecting Money into the Economy

How the government "injects money into the economy"¹. While it's true that the Queensland increase only amounts to 1.5% of the total stimulus, extrapolated out to the rest of the country it comes to around 20% (QLD Pop: 1.5M, Total Australian Pop: 20M), and then of course there's the Alcohol industry which probably experienced similar increases. (There's also smoking, illegal drugs, prostitutes, and other vices as well) In total we are talking around 40-50% of the the economic stimulus being wasted on vices².

Of course this 40-50% is based on the somewhat odd assumption that buying a brand new plasma when you've already got a perfectly fine TV is somehow not wasting money. Where do you suppose that the money spent on a new TV goes? It's made in China, so there's probably a decent chunk there, and then the rest of it will go to big business. For sure a lot of that money that goes to big business will eventually trickle done to employees and the such, but why not just cut the company tax rate?

1. Can you imagine a doctor injecting blood into a patient the same way the government injects money into the economy? "This patient needs a blood transfusion now! Quick extract some blood from his left arm so we can inject it back into his right arm!"

2. Now for sure I've got no problem with people spending their own money on alcohol and tobacco, and to a lesser extent gambling and some illegal drugs, but this isn't there own money, this is other peoples money which they are wasting.