Quote by Martin Feldstein

Increased government spending can provide a temporary stimulus to demand and output but in the longer run higher levels of government spending crowd out private investment or require higher taxes that weaken growth by reducing incentives to save, invest, innovate, and work.


Increased government spending can provide a temporary stimul

Summary

This quote suggests that while increased government spending can boost demand and output in the short term, it has negative consequences in the long term. The higher levels of government spending may lead to a decrease in private investment as resources get allocated towards public projects. Alternatively, to fund this increased spending, higher taxes might be imposed, which can then reduce incentives for individuals to save, invest, innovate, and work. Thus, this quote argues that the long-term impact of increased government spending can be detrimental to economic growth.

By Martin Feldstein
Liked the quote? Share it with your friends.

Random Quotations

Every part of this soil is sacred in the estimation of my people. Every hillside, every valley, every plain and grove, has been hallowed by some sad or happy event in days long vanished. Even the rocks, which seem to be dumb and dead as the swelter in the sun along the silent shore, thrill with memories of stirring events connected with the lives of my people, and the very dust upon which you now stand responds more lovingly to their footsteps than yours, because it is rich with the blood of our ancestors, and our bare feet are conscious of the sympathetic touch. Our departed braves, fond mothers, glad, happy hearted maidens, and even the little children who lived here and rejoiced here for a brief season, will love these somber solitudes and at eventide they greet shadowy returning spirits. And when the last Red Man shall have perished, and the memory of my tribe shall have become a myth among the White Men, these shores will swarm with the invisible dead of my tribe, and when your children's children think themselves alone in the field, the store, the shop, upon the highway, or in the silence of the pathless woods, they will not be alone. In all the earth there is no place dedicated to solitude. At night when the streets of your cities and villages are silent and you think them deserted, they will throng with the returning hosts that once filled them and still love this beautiful land.This text appeared in the Seattle Sunday Star on Oct. 29, 1887, in a column by Dr. Henry A. Smith. Smith took notes as Seattle spoke and created this text in English from those notes.

Chief Seattle, text of Chief Sea