Take care of the people, and the economy will take care of itself

John Maynard Keynes famously claimed “look after unemployment, and the budget will look after itself”.He was refuting the austerians of his time, who believed the best way to balance the budget was to attack it head on with tax rises and spending cuts. In Keynes’ view, employing people and otherwise stimulating the economy would kick start a process which would increase economic activity, getting people off unemployment benefit into work and paying taxes – thus balancing the budget. Conversely, he believed austerity would put this process into reverse and ultimately be counterproductive to its…

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