Ah. The "Trickle Up" theory. Interesting that the definition of "multiplier" is seen only in terms of government spending pumped into the lower end of the economy, rather than tax cuts. The idea of leaving the money with the citizens in the first place, without laundering it through a bureacracy first, would seem to be a lot more efficient.
Also, the multiplier is only seen as working from the bottom up
I went over the "trickle up" theory at, I think, MaxSpeak (I can't find the link now), where someone explained to me (I'm paraphrasing) that consumption drove investment, since people purchasing increased demand which increased sales which increased the profits of the producers, allowing them to invest. I pointed out that maybe just taxing the producers less might also give them more to invest, but how many votes can you get out of that?
Politicians love "trickle up." Obviously politicians get a lot more political mileage out of getting a given amount of money, either in spending or tax cuts, to a hundred low-income folks than they do a few wealthier ones.
Current Events » in reply to re: the private sector
Multipliers and "trickle up.
