Government Debt Pump Is Increasingly Coming To Nothing
In economics, we are familiar with the law of diminishing marginal returns. The same principle can also be applied to credit-financed government spending programs. For some time now, we have been experiencing diminishing marginal returns: for every government dollar invested, less new nominal gross domestic product is generated.
Of course, this is due to the significantly distorted allocation of capital, to the displacement of good capital from the private sector to the government sector, which soaks up finance capital like a dry sponge and channels it into unproductive channels. In short, the fiat economies we know suffer from anemia and from the distortion of capital markets and the manipulation of interest rates, which lead to productivity growth approaching zero or soon becoming negative as in the case of Germany.
In the case of the US, we can see that the fiat orgy is now accelerating, which means that desperately higher and higher debts have to be incurred to maintain the illusion of growth in nominal gross domestic product. The private sector is shrinking, the population is getting poorer per capita! There is only one cure for this economic disease: a return to the private formation of capital, stable money as the basis for all transactions and a dismantling of the gigantic state apparatus.
#USA #debtcrisis #productivity #keynes #socialism #bitcoin
