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Argument: Big government helps stimulate economic growth

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Jeff Madrick. "How big government helps the economy take off." Boston Globe. September 7, 2008: "Rather than harm the economy, the evidence shows that government spending, when done well, contributes critically to economic growth. Americans rely on the government for the free primary and high schools that educate the workforce. The government subsidizes college education and has built the immense transportation infrastructure that moves goods across the country and gets people to work. Federal, state, and local government have been essential to the nation's health, building clean-water systems and developing vaccines that have eliminated or minimized diseases like diphtheria, tuberculosis, and polio. The government can waste money, too. But the national rhetoric about the economy needs to stop focusing on how to shrink the government, and start focusing on how best to use it. [...] Contrary to the romantic claims about the nation's laissez-faire past, American history is a story of government intervening, time and again, to support growth.

Contrary to the romantic claims about the nation's laissez-faire past, American history is a story of government intervening, time and again, to support growth. [...] Early America created a national bank to maintain its finances and currency, critical to a smooth-functioning modern economy, at the instigation of Alexander Hamilton, George Washington's treasury secretary. Under Thomas Jefferson, well-known for his laissez-faire sympathies, America bought the Louisiana territories in what amounted to a large federal spending program. He thus provided cheap land to farmers at federally controlled low prices, enabling them to feed themselves and the nation, but also soon to produce surpluses to feed Britain as well, adding to America's wealth."


Jeff Madrick. "The case for big government." The Campaign for America's Future. October 22, 2009: "Government does indeed grow economies. It creates jobs and it produces prosperity. When politicians make correct decisions, they indeed make economies grow. There is no example of a major rich nation in the world whose government does not educate its children and teenagers; build its roads, bridges, superhighways, and airports; establish regulatory bodies to minimize financial busts; develop sanitation and water systems, and health care standards; support those who are temporarily unemployed; and provide a public pension to the elderly and a subsidy to the poor.

[...] When you comb the serious academic evidence about how and why economies grow, you will find that no case can be made that big government or even high taxes impede economic growth over time. History offers no lesson about the values of minimal government. There has never been a laissez-faire modern economy. To the contrary, the evidence shows that government typically contributed vitally to growth. As odd as it is to have to say this, without effective government, America would be poor today."

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