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Comment by slg | Hacker News Reader

If you click through to the eventual source, the cost is the predicted amount that will not be added to GDP. I am not sure that really qualifies at a cost.

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Something that you would otherwise get that you don't get because of a particular action is a cost of that action. I don't think that's particularly controversial view.

But is a reduction in GDP really a "cost"? To who?

> But is a reduction in GDP really a "cost"?

Yes.

> To who?

It's creation of value that would otherwise happen that is not happening; its a net cost to the nation as a whole. Which particular firms and individuals are paying it is, perhaps, harder to determine.

But the money will get spent eventually. And didn't it reside in consumer hands before it became tax coffers?

I still have a tough time with reduced government spending being considered a cost.

To businesses, individuals and eventually governments at every level in lost tax revenue. By not spending the government is effectively removing money from the system. Over the medium term a reduction in GDP may cost even more as the Federal Reserve may feel the need to provide stimulus to counteract the effect, increasing its liabilities and interest costs.

Don't worry, we can make it up by breaking all our windows.

What do you expect when increasing next year's budget over this year's by five percent instead of ten percent counts as a five percent cut..?

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