Over the past century, government spending grew to an average of forty five percent of gross domestic product (GDP) among developed countries. But do these expenditures make countries more productive or achieve such social objectives as improving the health and literacy of the population?

While some government spending on roads, education and criminal justice, for example, positively affects per capita GDP, beyond a certain point the tax burden necessary to finance this spending slows economic growth and thus retards the growth of per capita GDP. Today, total government spending in the United States and other developed countries far exceeds the level at which it increases national income.

I chose to do this article because I have always known that some programs are governmentally funded, but never knew which ones were funded and why. The government has an

This article is about how government spending affects the economy's growth rate negatively. According to Garfield, government spending reduces productivity, labor force participation, but yet increases unemployment. These factors will be explained below.

Both the textbook and the articles correlate on some issues. They both agree that taxes are the main revenue boost for the government and that the majority of spending does go to education and health, on the state and local spending issue.

Governor Arne H. Carlson asked Minnesota Planning to look over government spending for the state of Minnesota. She wanted to see if her expectations and disbursement of money towards health spending were correct. According to John Hustad, deputy director of Minnesota Planning, government spending was indeed given to health expenditures and he foresees health spending to rise over the next few years. One reason for the rise is the aging of Minnesota's population.

Rud Garfield, Government Spending and Economic Growth, http://www.house.gov/jec.fiscal.budget/spending/spending.htm, 1995.

The number of public employees can measure governmental outlays. Government expenditures on employees, rent, electricity, etc. are included in government outlays. However, total government outlays include transfer payments. Examples of transfer payments are welfare and social security. Before World War I, government outlays did not exceed ten percent of its annual national income. Now, government outlays are leveling off between thirty-five and forty percent.

Government spending has an impact on productivity. Productivity growth rates reduce government spending due to capital accumulation and inhibiting innovation. Another way productivity is hurt by the economy is by private savings being destroyed. Private savings, however, are needed so that technology can be improved and more money can be invested into plants and equipment. Another reason why productivity can be reduced due to government spending is because resources are taken away from private sectors and put into public sectors that are unproductive.

According to this article by an unknown author, the government spends money just like any ordinary person or family does. They spend money when they receive it. But unlike the ordinary person or family, the government spends more than its income. In the past twenty years, government spending has exceeded its incom

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