economics 101

The multiplier is an economic term that relates to how often a dollar turns in the economy.  The higher the number, the more beneficial for the economy.

Made in USA = the highest multipliers.

If you look up economic multiplier online, the results may be skewed in terms of how OFTEN the government spending multiplier is referenced.  

Consumption + Investment + Government spending (C+I+G) is a way to measure or predict the overall size of the economy.  

C+I+G is a core tenet of macroeconomics and pioneered by noted economist, John Meynard Keynes.  

Think of numbers (multipliers) in front of each:

6.82 *  C

2.14  *   I

1.97  *  G

Consumption

What we buy.  Consumers and Corporations.  

If you buy something Made in USA, your purchase:

• supports employees of the company
• generates tax revenue including local, federal, state, social security, etc.
• spreads the money around by whatever the employees buy
  • restaurants
  • dry cleaners
  • car dealerships
  • dance studios
  • dollars keep circulating = the multiplier

If you buy something Made in Another Country, your purchase:

• supports the business selling the item and generates sales tax
• from there, the money goes out of the country
  • No employment or social security taxes paid on production.
  • The Multiplier effect stops

Investment

A theoretical return in the future.  You save money in a bank and that money is loaned to a business and the economy improves because the business hired people or bought equipment, etc.  

Another potential investment would be tax policy.  Cut taxes.  Put more money in the hands of the individual or corporations.  How the money is spent has a big impact on the multiplier.  

Government

When the government spends money, there is a multiplier involved.  

We build roads and employ construction crews.  Those persons spend money in their communities and generate multiple streams of tax revenues.  We buy drones and B-2 bombers from Northrop Grumman and support its employees, suppliers, R&D, etc.  Those dollars are spent and circulated around the country.  The highest G multipliers bolster tax revenues.

Other Considerations 

The multiplier turbocharges the economy.  The higher the number, the more lives impacted.

Manufacturing jobs have some of the highest multipliers in the economy.  Wealth is created.  An example: six dollars worth of inputs create nine dollars worth of outputs. 

Our plan is to manufacture in the United States utilizing world class talent from across the globe.  

Investments in renewable energy lead to infrastructure cost reductions.  Think of that from a societal perspective.  Investments are made now and in the future costs go down. More resources are available for other uses.

The input cost for our energy generating system is free.  The volatility of oil and gas prices are eliminated.  In applications for the Department of Defense, the security of service members is improved.