V.Good analogy, i'd +1 if i couldDrunkFace wrote:
Lets make this nice and simple.
There is one business, a rudimentary government which just does transfer payments and a few employees.
This country has 10 people living there, 5 are employed in the one business, 5 are unemployed.
Scenario 1 (The Lowing approach):
The taxes from the Business go straight back to the business so it can 'grow'. Unfortunately because there are only 5 people who have an income, there are only 5 people buying anything so the company only needs 5 employees to cover the demand. But at least the owner is happy and can go on a nice overseas holiday. The 5 unemployed are never going to get a job no matter how hard they try. The business is never going to expand because there is no extra demand for their product.
Scenario 2:
The money from the taxes goes to the 5 unemployed people. Now there are the 5 employed people with an income and 5 people with government support. Now the customers of this business has increased to 10. The demand has increased and now the business is making more sales and needs to expand to maintain enough supply. The owner is again happy because their business is more profitable and has expanded, but there are also 5 extra happy people now with jobs. The Government is also happy because it now has a larger business and more people with an income producing more tax income.
Small hourglass island
Always raining and foggy
Use an umbrella
Always raining and foggy
Use an umbrella