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But that's not as useful a frame when you're talking about inflation because in that case the number of nominal dollars matters. Saying that real spending is fl
by AnthonyMouse 2y ago
But that's not as useful a frame when you're talking about inflation because in that case the number of nominal dollars matters. Saying that real spending is flat during a period of inflation sounds like something neutral is happening, when really you're increasing the number of nominal dollars being spent into the economy. Doubly so when you're running a deficit.
It's also implying that the government decides it needs ten artillery rounds and then allocates that amount of money, instead of determining how much money it can get away with spending/borrowing and then having various interest groups fight over who gets it. If it was the first one then there would be non-trivial periods when real government spending goes down because the need for some existing program declines and it gets reduced or removed without being replaced by anything, right?