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I mean, GDP shouldn't account for debt. GDP is a measure of how much we produce. If people within our borders spend a year building $1tn worth of tanks, then we
by tedsanders 9y ago
I mean, GDP shouldn't account for debt. GDP is a measure of how much we produce. If people within our borders spend a year building $1tn worth of tanks, then we have produced $1tn of GDP that year. In terms of measuring what we produce, it's irrelevant how much we promised to pay China in the future. (Though of course in terms of predicting our future wellbeing, our promises to China do of course matter.)
- vageli 9y agoIf your production was only possible with the injection of foreign funds, why should the value count towards your nation's GDP and not the lender nation?
- deleted 9y ago[deleted]
- tedsanders 9y agoGDP measures (traded) production. If you produce $2tn of tanks, in tanks, then by definition that production is part of your GDP. Now if China sold you $1tn in tank parts in exchange for future payments, then sure, that $1tn will be part of China's GDP.