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Easy fix for that! Just change the definition of GDP by excluding government spending: https://apnews.com/article/trump-gdp-economy-government-spending-lutnick-
by hn_throwaway_99 2y ago
Easy fix for that! Just change the definition of GDP by excluding government spending: https://apnews.com/article/trump-gdp-economy-government-spending-lutnick-7414ba1bd441bd4bf64620bfd66923b2 https://apnews.com/article/trump-gdp-economy-government-spen...
- criddell 2y agoThere are easier ways. I'll write a poem and sell it to you for $50 trillion and you draw a picture and I'll buy it for $50 trillion from you. We could get this done today and bump GDP by $100 trillion.
- saulpw 2y agoSales or income tax will be a problem though.
- onlyrealcuzzo 2y agoNot if you sell in a state without income tax. And I imagine someone creative can probably find ways to make this not classify as income.
- criddell 2y agoTrue. We'll probably have to make the poem and picture about Jesus and do it through our new church in New Hampshire.
- 0cf8612b2e1e 2y agoSolve the deficit at the same time!
- arunabha 2y agoI hear the standard practice is to have the IP of the poem owned by a foreign entity(Ireland is pretty popular) and then for the US entity to pay a royalty of $50 trillion to the foreign entity so that the net revenue in the US is zero. I believe it has it's own name - The double Irish.
- ummonk 2y agoYeah but then that only contributes to the GDP of Ireland, not the US. Not coincidentally, Ireland has one of the highest GDP per capita in the world.
- lotsofpulp 2y agoThis only works within the European Union because the EU rules allow it. It would not work between the US and Ireland.
- lotsofpulp 2y agohttps://www.bea.gov/system/files/2020-04/GDP-Education-by-BEA.pdf https://www.bea.gov/system/files/2020-04/GDP-Education-by-BE... >Who calculates GDP? >Economists at the U.S. Bureau of Economic Analysis estimate GDP using thousands of data points gathered by other federal agencies and some private data collectors. I presume these economists would ignore outliers such as that example, especially ones that would result in unrealistic sales tax or other tax liabilities. They have a spreadsheet showing sources here: https://www.bea.gov/data/gdp/gross-domestic-product#:~:text=Gross%20Domestic%20Product%2C%204th%20Quarter%20and%20Year%202024%20(Second%20Estimate)&text=Real%20gross%20domestic%20product%20(GDP,real%20GDP%20increased%203.1%20percent. https://www.bea.gov/data/gdp/gross-domestic-product#:~:text=...
- JumpCrisscross 2y ago> I'll write a poem and sell it to you for $50 trillion and you draw a picture and I'll buy it for $50 trillion from you. We could get this done today and bump GDP by $100 trillion Nominally, yes. Real, no. (In practice, given the barter resemblance of the trade, there would be no impact.)
- gitfan86 2y agoWhy is it real GDP when a government contractor makes a PDF report, but isn't real GDP when I make a poem?
- sunnyps 2y agoBecause money paid to the government contractor results in a person (persons?) getting paid along the way and then a large part of that flows into the real economy via consumption / spending. In your $50 trillion poem example, no money can possibly flow into the real economy because you simply do not have $50 trillion to pay anyone - you're just describing a wash trade of a worthless $50 trillion IOU note not unlike a NFT or crypto memecoin. Best case is that the poem is worth something non-negative.
- deleted 2y ago[deleted]
- zellyn 2y agoThat's the point.
- JumpCrisscross 2y agoGDPNow tracks real GDP.
- zellyn 2y agoAh, thanks! Interesting. How does it know which is Real and which is poems?
- gruez 2y agoI doubt this sort of chicanery actually happens, or would actually work.
- bugglebeetle 2y agoI see you’ve never heard of the market for fine art.
- edm0nd 2y agoalso NFTs
- frumper 2y agoThat's great for money laundering, but you'd have to pay taxes on it. Good luck.
- gruez 2y agoYou might not agree that a blank canvas is a $100k "art piece", but assuming both parties are sincere, what's the issue? It's not really any different than some luxury brand selling a $50 (being really generous here) t-shirt for $500.
- sadeshmukh 2y agoTheir worth is inflated and their whole suite of same artist work increases in value.
- deleted 2y ago[deleted]
- deleted 2y ago[deleted]
- JumpCrisscross 2y agoNot relevant. The effect is almost entirely from net exports collapsing.
- jfengel 2y agoBut redefining the numbers does effectively prevent us from noticing.
- JumpCrisscross 2y ago> redefining the numbers does effectively prevent us from noticing Not really. If they started fucking with BLS statistics, that would be a problem. But DOGE hasn’t gotten there yet.
- adgjlsfhk1 2y agothey're working on it https://apnews.com/article/trump-gdp-economy-government-spending-lutnick-7414ba1bd441bd4bf64620bfd66923b2 https://apnews.com/article/trump-gdp-economy-government-spen...
- llm_nerd 2y agoI think they are pointing out that the current admin is doing the "sharpie on the hurricane path", or the "if you don't test for it you don't have cases" sort of approach. But like those two ridiculous events, it's much, much larger than just government cuts. I mean...it doesn't even account for government cuts yet.
- epoxia 2y agoDoes anybody know how that would work? I know of the 3 ways of measuring GDP in econ basics (All income, All expenditure, All value add). I assume they only use one method and just pull out government? I assume it's expenditure method, but what would it mean for income method. Ignore incomes of gov employees? But then what about contractors. At what point do we start to view the number shifting as untrustworthy like China and Russia.
- LastTrain 2y agoIt was a joke