Friday, March 05, 2010

Barrett's New Econ 101

Tom Barrett explains it all for you.

...bear in mind we're talking about well over $800 million coming to this state's economy, right now, and it's going to come here and create jobs and opportunities to spend money. As a result, if you use the simple economic concept of a multiplier effect it will have a ripple effect, and it's going to create more jobs and more spending. If you take just a percentage of that $800 million, let's say it's 10%, that's $80 million.... I believe that spending [for subsidies] for years will be covered by the multiplier effect of that injection of dollars into the economy.

Very interesting. That's the first time I have EVER heard that a "multiplier" effect will repeat itself year after year after year.

Les Aspin told us it was only a one-time (near-contemporaneous) thing.

And, of course, that $850 million will NOT be all spent in one year--so one applies the 10% multiplier (a reasonable guess, by the way) over the entire term of the building process.


HT: Sykes

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