The Consequences of Excessive Government Intervention

The fact that there are areas in which government is needed cannot be denied. The state collecting taxes for the provision of things such as roads, bridges, police departments, fire departments, or even a safety net for those that fall on hard times, as long as it is well regulated are all reasonable uses. I will also not deny that there are areas where central government intervention is needed. Regulation to prevent monopolies, ensuring segregation of public schools and facilities, and protection of rights, to name a few, are perfectly acceptable functions of central government. Big government is not the answer, it is actually a big part of the problem, especially when meddling with the economy.

In this paper, I am going to dispute one of the points, in detail, that Jeff Madrick makes in, "Taking Sides, Clashing views on Political Issues," as a big government success. Mr. Madrick points to the Marshall plan as an example of one of the many great accomplishments of big government (McKenna & Feingold, 2012). Mr. Madrick is not being completely truthful with this claim. The Marshall plan gave European countries almost $100 billion to help rebuild, and is also credited with saving European economies after World War II. Tyler Cowen, an economist from George Mason university, points out in his study of the plan, that the economies that received the most funding under the plan actually grew at a slower rate than the economies that received the least money (Cowan, 1985).

The German economic recovery is the example used most when discussing the success of the Marshall Plan. Cowan points out that aide to Germany never exceeded more than 5% of GNP while allied policies regarding occupation and reparation were actually costing 11...

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...ttp://www.cato.org/pub_display.php?pub_id=6138.

Christie, Les. (September 16, 2010). Poverty in the U.S. spikes. In CNN Money. Retrieved October 6, 2011, from http://money.cnn.com/2010/09/16/news/economy/ Census_poverty_rate/index.htm.

Cowan, Tyler. (1985). The Marshall Plan Myths and Realities. In Google docs. Retrieved October 6, 2011, from http://docs.google.com/viewer?a=v&q=cache: L1L1dFSk7zAJ:www.gmu.edu/centers/publicchoice/faculty%2520pages/Tyler/Marshall_ Plan.pdf+Heritage+foundation+Tyler+Cowen+Myths+and+realities+Marshall+Plan&hl=e n&gl=us&pid=bl&srcid=ADGEEShdIkrVVTutHHxL6Nx- aV4Bi3h7cjsLpzah3EDyllKhZEI4rEfzLud2emU1KNsBWUeEr5rBn5YfYU7A6AEUVD29VIpKu 6yBX38kBAgy4YLAO7nc4i04_6ni2PbxtmObnq3qPYjc&sig=AHIEtbQzmXCxtE76M6nbKN7L EweZ52ud2g.

McKenna, George and Stanley Feingold (2012). Taking Sides Clashing Views on Political Issues. New York: McGraw-Hill.