Politics
Out of context: Reply #15103
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- TheBlueOne0
"[The] real rate of return on government 5 year government securities is now negative. You want to stop and absorb that because I think it’s a bigger deal than most people realize.
Suppose the government had two choices. It could either pay for infrastructure improvements as it went along out of tax revenue or it could borrow money build the infrastructure now and then repay the money with tax revenues.
Ordinarily the question would be, does the advantage of building quickly outweigh the cost of the interest.
However, right now the interest cost is negative. The government saves money by borrowing now rather than waiting and paying cash. Let me say again because I have noticed that this goes against so much intuition that its hard for many people to wrap around when I first say it.
The government will wind up paying more if it decides to pay cash for a project than it will if it decides to borrow. This is irrespective of the return on the project itself or the advantages of avoiding delays or anything like that. It is simply that the cost of borrowing is negative.
It is cheaper than paying cash."
- fed gov. lends money to local municipal projects along with not increasing taxes its really money lots for road projects.74LEO
- fuck our roads are disasters, holy shit..********
- If we invested in our roads/infrastructure they wouldn't be "shit". And more people would be working to rebuild them. But then people like you would complain abouta the spending.Josev
- rebuild them. But then people like you would complain about the spending.Josev