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Do you have any evidence that increased government spending harms economic growth? It seems like an a priori certainty in right wing thought, but what evidence
by badsock 10y ago
Do you have any evidence that increased government spending harms economic growth? It seems like an a priori certainty in right wing thought, but what evidence I've seen suggests that the effect is minimal or even beneficial (within the spending ranges that we see in modern developed nations).
- jolux 10y agoYou're entirely right, government spending does not harm economic growth.
- badsock 10y agoI can't tell if you're being sarcastic, but I think it's important to note that if you make the reductio ad absurdum argument that a tax rate of 100% has strongly negative effects, sure I'll go with that, but if there's a claim that what we have right now is either too much or too little, then there needs to be some sort of evidence to support that claim.
- bottled_poe 10y ago> "a tax rate of 100% has strongly negative effects" Could you elaborate?
- badsock 10y agoI'm saying that I wouldn't argue that communism (in the sense that all value produced is publicly owned) is a good economic system.
- repsilat 10y agoThere's another pole to reductio towards, though -- governmental spending increases without commensurate increases in taxation. I don't know enough macro to know what the resulting inflation would look like, what would happen to interest rates or exports or quality of life etc etc... No doubt mainstream economists would be aghast at the thought (it isn't a mainstream idea, after all -- our recent stimulus has been monetary, not fiscal, and it's only meant to be a short-term thing) so it's probably not such a crash hot idea either.
- CountSessine 10y agoNot to champion austerity (and no, I'm really not championing austerity), but if increased spending is paid for with increased borrowing, government bonds will complete in capital markets and make borrowing generally more expensive for everyone. Of course right now capital is ridiculously cheap and the economy still isn't doing very well...
- vacri 10y agoAnd government projects improve people's ability to work, whether it's by education or welfare, or negotiating trade treaties, or protecting trade routes (military). For example, the US gets immense economic benefits from it's oversized military, being able to lean on people to give it favourable terms - something to remember for the people who want to 'stop being world cop' (a self-imposed role, taken to improve it's economic power).
- deleted 10y ago[deleted]
- damptowel 10y agoThe amount of GDP going to paying of debt is historically high, it's a huge drag on the economy. http://static.cdn-seekingalpha.com/uploads/2012/5/10/saupload_428250-13363801587809994-Michael-Clark.png http://static.cdn-seekingalpha.com/uploads/2012/5/10/sauploa...
- totony 10y agoI recall this is a well-known fact from introductory macroeconomics
- badsock 10y agoEvidence is the standard that I think that statements like Mr. Bright's should be held to - not vaguely remembered economic theories.
- deleted 10y ago[deleted]
- ktRolster 10y agoDo you have any evidence that increased government spending harms economic growth? It depends on the spending....the obvious counter-example are roads, which had a huge positive effect on growth when they were built. Alternately, spending on bombs for war have a negative effect....they blow up in the desert and don't help anyone except the people who built it (so you might as well have left those dollars with the taxpayers). A similar argument is "more/less regulation." It really depends on the details of the regulation.
- deleted 10y ago[deleted]