[garbanzo]

Or we can invest in new businesses that will either use the excess capacity as it is or convert to something that can be used.

That could be done - though I would wonder why existing concerns can't find anything to be done with their excess capacity.

[Iris7]

Existing firms fixed costs are too high to increase production, since the increased production would have to be sold at lower prices. Firms always increase production until they are unprofitable at the margin.

[Moonman62]

That could be done - though I would wonder why existing concerns can't find anything to be done with their excess capacity.

Why didn't established companies add any net jobs during the Reagan economic expansion that lasted 17 years? I look at our problem as excess resources, rather than excess capacity. Leftists look at the problem as excess capacity, because they don't want to have the government cut back for the sake of allowing the private sector to keep more of its resources. Austrian economists look at the problem as excess capacity, because they love to pick at the remains left by human misery.