Can a Government spend its way out of a recession?

Comment on a post by Tom Elliott called “Talk is Not Cheap” dated 10 December 2008 at ABC’s Unleashed

Tom Elliott’s statement

“It is the Federal Government which, once it gets over its 1996 election loss fear of budget deficits, just might be able to spend its way out of economic recession.”

My response

An appeal to the more learned among us, is there any examples of this actually working without massive tariff barriers going up de facto or otherwise?

Government expenditure comes from taxes (paid mostly by Aussie battlers), not from some mythical magic pudding.

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