Big Government Limits Economic Growth
Last month, Gov. Tom Corbett's budget address kicked off state budget negotiations. As lawmakers debate priorities, one thing is crystal clear—low government spending fosters economic growth.
- The Mercatus Center's Matthew Mitchell outlines how economists studying living standards across the world find that low taxes, modest government budgets, reasonable regulations, free-markets and property rights lead to a stronger economy. "The benefits of freedom are profound: per capita income in the world's freest countries is about seven times that of the least-free."
- The World Bank's January publication "Golden Growth," acknowledges that big government through higher taxation limits growth. Taxes inevitably grow government, creating more bureaucracy and reducing private sector growth.
- Russ Roberts' post on "Post-war austerity" shows that we don't have to remain dependent on government spending. Roberts shows that after WWII, government successfully reduced its size without harming the economy.
It is clear that reducing the size of our bloated government is necessary to grow the economy. State policymakers took a significant step in this direction by enacting the first year-to-year reduction in state spending in at least four decades. The only way to protect our fiscal house and fireproof Pennsylvania's economy for ourselves and for generations to come is to maximize freedom by restraining government spending.
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The Commonwealth Foundation is Pennsylvania's free-market think tank. The Commonwealth Foundation transforms free-market ideas into public policies so all Pennsylvanians can flourish.