Visualize a triangle. At one point is an unemployed worker. At another point is the owner of the box factory who laid off employees.. The third point of the triangle is the owner of the store that sells boxes at retail. The unemployed worker has no money to shop at the box store. The box store owner can’t sell his inventory of boxes so he has placed no orders from the factory. The factory has no orders for boxes so there is no reason to hire workers.. Sound familiar?
How do we stimulate this moribund economy? The government has a hundred dollars. Who does the governent give it to? The factory owner? Hardly. Why manufacturer more boxes if you have no orders? The store owner? Hardly. Why buy more boxes if you can’t sell those you have? The unemployed worker? Bingo. Give the unemployed worker a good job. He takes his money and goes to the store and buys some boxes. The store owner orders more boxes to replace his inventory. The factory owner needs workers to fill the order from the store owner so he picks up the phone and hires workers.
Giving the unemployed worker a good job is the answer. A rising tide lifts all boats. Merely funding public works projects doesn’t do much good if the work is done by people who already have jobs. Wouldn’t it be reassuring to know that if you lose your job and you are willing to work, you can get a good job working on government programs that add value to the country (roads, parks, research, etc.). The government becomes the employer of last resort. Remember in this example the “government” does not necessarily mean the federal government alone. State, county and local governments would be involved as well. As the economy improves the public workers would find private sector jobs.
Think about it.