When I read statements like this, I still see a reversal of cause and effect. You see idle machines and say, what, we should inflate (or tax) and inject money to get them online again, but you never ask why the machines are idle in the first place. If consumers start liking a new product B over product A, product A may go out of business, its capital, unused. There's no doubt we could keep company A running if we wanted to, but that'd be a net loss; the consumers have decided that company A no longer serves their ends. The period of adjustment, where A's capital is reallocated in some other use, requires that people first know what to use it for, so it's reasonable that it will sit "underutilized" for some time. This is both necessary and essential to growth.
For instance, take the housing boom. Cheap money and affordable housing policy perpetuated unsustainable growth in that industry -- that is, malinvestment. Malinvestment per se isn't a problem (though we shouldn't encourage it via government coercion) as long as markets are allowed to address and correct for it, and that's exactly what the inevitable downslide does. It's a period of correction. In housing, a million-or-so homes ended up standing empty; people began to realize that starting up that construction business or quitting one's old job to be a realtor wasn't such a great idea. Spending, via inflating savings away and spurring malinvestment, may take some pain out of the correction today (the utter failure by any objective standard of Obama's massive stimulus calls even this into question, however), but like a heroin addict shooting up every time he feels the itch, it just ends up making that final period of withdrawal much worse.
Supply Side has failed since 1981. You can't actually find a place when it hasn't failed.
