"Shrinking the government will create jobs," Robert Reich, American political economist, once said with a chuckle. It makes absolutely no sense to him. The United States government is one of the largest employers in the United States, and employs thousands of people directly, or indirectly due to funding. Reich explains that federal contractors build our infrastructure such as schools, public buildings, parks, hospitals through funding and support from the government. This basically creates a trust and allows businesses to put resources to the task of building roads, bridges, sewer systems, and other infrastructure. The funding gets distributed to all the workers who actually build the infrastructure and it stimulates the economy because that money will be infused into local economies. .
The opposite outcome, caused by the government not providing funding, would be the money does not get to the workers and it creates no demand for goods. This leads to a recession and an economy which is not hiring new workers. He calls the government the "purchaser of last resort, " meaning if there is no demand of jobs - the government should purchase the services of the American worker. He continues to state that the current infrastructure in the United States is crumbling and it is the perfect time for America to borrow money to rebuild this infrastructure and indirectly pay the American people. This will lead to economic recovery which will then allow for further development. The current interest rates for borrowing money are very low and it is the perfect time for the government to invest in the future of America. This statement is met with a big applause from the audience, which is where the video ends. .
A video, created by The Heritage Foundation, called "The Debt Limit: Made Simple," tries to create a simpler picture by shrinking down the United States into a neighborhood association. The neighborhoods homeowner's association is compared to the United States government, and the fees paid are the taxes.
