&gt;The private sector saving too much or too little is explicitly NOT the issue.<p>Quite. This is what I was saying.<p>Public sector deficit &#x27;too high&#x27; = Private sector saving &#x27;too much&#x27; = Not a particularly concerning issue.<p>Deficits matter only insofar as they cause inflation.<p>&gt;The question is whether that savings goes into G or I - i.e., whether the money is spent on prisons or a new Tesla factory (to borrow two examples that contradict the standard mood affiliation).<p>As far as pushing aggregate employment higher and escaping from the liquidity trap is concerned, you could do either. Just so long as it employs people.<p>The highest multiplier for any government spending was probably FDR&#x27;s new deal public works program.<p>ROI is a different question and not one that can really be looked at in purely monetary terms. If the government paid people to write open source software they could end up creating staggering amounts of value but it wouldn&#x27;t show up in any economics statistics.