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I don't think it's the case that government spending is causing a decrease in economic productivity. I think it's the case that government spending, specifically deficit spending, is increasing to cover up the decline in economic productivity. Recall that per the GDP formula the benefit of "G" funded by tax revenues is matched by an equivalent decrease in "C" and "I", so that "G" contributes positively to the economy only when it is funded through debt accrual or money-printing.I think the government has run the economy like a chain-letter scam and is now seeking to cover up the evidence of its incompetence with a gross spending binge.
I don't think it's the case that government spending is causing a decrease in economic productivity. I think it's the case that government spending, specifically deficit spending, is increasing to cover up the decline in economic productivity. Recall that per the GDP formula the benefit of "G" funded by tax revenues is matched by an equivalent decrease in "C" and "I", so that "G" contributes positively to the economy only when it is funded through debt accrual or money-printing.
I think the government has run the economy like a chain-letter scam and is now seeking to cover up the evidence of its incompetence with a gross spending binge.
