19 February 2025

Let's decrease deficit and the public debt. In order to do that, we decrease government spending. Then:

Decrease spending -> the private sector and consumers have less money -> demand goes down -> supply goes down -> GDP goes down -> tax income goes down -> deficit goes up

The deficit (i.e. private surplus) among all branches sums up to zero. Every liability (debt) is someone's asset. Every spending is someone's income.

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