Uh, yes. Yes it will. The workers that fill those potholes will earn wages, which they can then use to pay for goods. By purchasing those goods, they pay other workers' wages, and the virtuous cycle continues.
Listen HN, I love your knowledge of technology and entrepreneurship. But the economics posts on here are deplorable. We've seen disruptive technologies many times before: the cotton gin, the television, steam power, the car. In every one of those instances, our work force has adapted and moved into new jobs.
The Internet is not some all-consuming monster; it cannot universally substitute for real goods; it will not replace jobs that need to happen in person.
Don't fall for the broken window fallacy. If the government wasn't taking money from people via taxation to pay for pothole fillers, then the taxpayers would have their money to spend on what they really want, which would also maintain the virtuous cycle. What you see is the pothole fillers spending money, but what you don't see is all the people who had their money taxed spending less. (If the taxpayers weren't spending their money, it would be in banks being loaned out to other people who would be spending it.)
If what you're talking about is Keynesian government stimulating the economy in bad times by going into debt, that could also be accomplished by cutting taxes rather than borrowing to pay pothole fillers.
Well, yes, instead of having potholes fixed, we'd be repairing the frame of our cars instead, at much much higher cost (and not doing other things). Further, pothole fillers end up employing lots of different kinds of people than a millionaire would. Finally, banks tend to loan to people with money... they don't typically loan to those who don't have money; it's not a zero-sum game.
I think you have a good point about filling potholes being cheaper than repairing cars, but that wasn't really the point I was making. (I'm not necessarily against filling potholes, just filling potholes excessively as make-work.) I was just pointing out that saying that government spending to hire pothole fillers for the express purpose of stimulating the economy is falling for the broken window fallacy. http://en.wikipedia.org/wiki/Broken_window_fallacy
It's actually not--you're misunderstanding the broken window fallacy.
The classic example goes like this: "Let's break windows and hire people to replace them! That's a stimulus!" OP did not suggest digging holes into the street and filling them, however--fixing road wear-and-tear is an investment in public infrastructure.
Maybe I misunderstood, but I got the feeling from the OP I was responding to that he was suggesting we fill more potholes in order to stimulate the economy. I'm kind of working off the assumption that we are already filling the important potholes often enough, so filling more potholes just to spend money sounds like make-work.
if cutting taxes went to actual working people, that would be true. cutting taxes even more on rich people and companies leads to higher wealth inequality and not to economic stimulus.
Uh, yes. Yes it will. The workers that fill those potholes will earn wages, which they can then use to pay for goods. By purchasing those goods, they pay other workers' wages, and the virtuous cycle continues.
Listen HN, I love your knowledge of technology and entrepreneurship. But the economics posts on here are deplorable. We've seen disruptive technologies many times before: the cotton gin, the television, steam power, the car. In every one of those instances, our work force has adapted and moved into new jobs.
The Internet is not some all-consuming monster; it cannot universally substitute for real goods; it will not replace jobs that need to happen in person.