Government Is Hurting The Economy — By Spending Too Little

washingtonpost.com — You’ve heard this before: The government is holding the economy back. And it’s true. But exactly what the government is doing to hold the economy back might surprise you. Typically, when people say the government is hurting the recovery, they mean that deficits are too high and uncertainty over future policy is scaring businesses. But there’s little evidence of that. It’s not because government is spending too much, or because of concerns over future policy. It’s because government, at all levels, is spending and investing too little. Despite the stimulus and various other policies we’ve passed to help the recovery, and despite the large deficits the government has been running, government spending and investment have, at all levels, been contractionary since 2010.

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