Government Spending and Economic Growth
The Mercatus Center has a new brief policy analysis reviewing the economic literature on the role of government spending and economic growth. Their conclusion would (but should not) shock many politicians:
Although the studies are not all consistent, historical evidence suggests an undesirable, long-run effect from government spending: it crowds out private-sector spending and uses money in unproductive ways.
Recently, the European Central bank advised EU nations that the best way to spur their economies was to cut government spending.