Governmental social programming

Economists examined the Great Depression after the fact and found out that much of the unemployment and woe could have been reduced if total demand was greater.The lack of spending reduced demand and reduced jobs.Various solutions were offered but it was the British economist Lord Maynard Keynes that came up with the most acceptable solution for governments to follow.He suggested that governments could go into a deficit and borrow money to put into bank coffers. This excess money would drive down interest rates and banks would make more cheap loans.This would increase spending and increase demand.This was called deficit spending.And to a large extent it was adopted by governments all over the world.

Some governments came up with an even braver idea.When recession is not that deep spend more money and increase consumer spending before there is a recession.This is another form of deficit spending.And instead of depositing money into the banks in the form of government bonds as Lord Keynes had suggested just give extra money to the banks.This does keep interest rates down but now allow the banks to give the money away to special customers.This does allow demand to stabilize and not fall.This is a very costly form of deficit spending but what if you already had the money collected?This is the role of the consumer tax,the G.S.T tax.It produces billions of dollars that can be used to increase consumer spending at very little cost.But the cost ,of course, is the extra tax burden placed on all those people working and those trying to get a job but can't because the government has little money

for job creation programs.