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hi everybody hope youre doing well a key argument that classical economists tend to men against the use of active fiscal policy when it comes to dealing with low economic growth the recession and economy is that if the government has to borrow money in order to spend then they could well crowd out the private sector were going to look in this video what that actually means and how the private sector can be crowded out with increased government borrowing and increased government spending so um first of all you would have watched my video Im sure before about how the governments borrow money in how they issue bonds when it comes to facilitating spending by moving to borrow money so running a budget deficit taking out a public second net cash requirement adding to the national debt in the economy the government needs to sell bonds so the UK and Ill be selling gilt for Treasuries and what theyre doing basically is replacing this IOU this piece of paper with cash and who buys them whi
