Some environmentalists claim that the higher the international debt a nation carries, the more likely it is that the quality of life in that nation will suffer. These environmentalists argue that in a variety of ways the effort a nation must expend to pay its debt hastens the depletion of its natural example, through the elimination of government subsidies for practices that reduce pollution or conserve natural resources.
But the evidence for the environmentalists’ claims is weak. With respect to the exports promotion hypothesis, one recent study does suggest a positive correlation between international debt and deforestation, but also indicates that other factors besides debt may play a stronger role. Another study found only a slight positive correlation between debt of the fiscal discipline or economic restructuring imposed by debt may rein in potentially harmful spending.
What this question is testing
Anticipate
The author's parting thought is that fiscal discipline from debt might actually be a good thing sometimes. That is the strongest inference we can draw about the author's views on government policy: spending less is not necessarily a bad idea.
Goal
Find the answer about spending cuts having potential benefits.
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