Government Spending Throughout the Past Thesis

The impact of government spending onto the overall economy is a highly debated topic, with some arguing the advantages, whilst others pointing out the limitations. A most relevant example of positive effects is given by the recent implementation of the Troubled Asset Relief Program, which has had the benefit of salvaging numerous American icons. Nonetheless, this situation was an extraordinary one and other specialists argue that in times of normal economic state, the impacts of government spending are among the most negative ones on the long run. Some of these harmful effects refer to increased costs and poor quality of public services, an inefficient allocation of resources, lack of motivation and innovation and so on. The pivotal role of government spending is then that of ensuring peace and stability and creating a climate that fosters economic growth.The actual involvement should however be minimal.

References:

Garfield, R., Government Spending and Economic Growth, Joint Economic Committee, http://www.house.gov/jec/fiscal/budget/spending/spending.htm last accessed on July 21, 2009

Mitchell, D.J., The Impact of Government Spending on Economic Growth, March 31, 2005, Backgrounder, Published by the Heritage Foundation

Solman, P., When the Government Writes Checks, Where Does the Money Come From? PBS, 2009, http://www.pbs.org/newshour/bb/business/jan-june09/solman_03-17.html last accessed on July 21, 2009

Troubled Asset Relief Program -- TARP, Investopedia, 2009, http://www.investopedia.com/terms/t/troubled-asset-relief-program-tarp.asp last accessed on July 21, 2009

U.S. National Debt Clock, 2009, http://www.brillig.com/debt_clock / last accessed on July 21, 2009.....