Your first point is well taken: The person who gets the immediate tax cut is not always the person who bears the future tax burden. On the other hand, this point might not be too important as long as people view a dollar for their kids as equivalent (at the margin) to a dollar for themselves. The fact that people contrive to leave positive inheritances is some evidence for this view.
Your second point seems to me to be entirely off the mark, because the right exercise is to compare government spending financed by taxes to exactly the same spending financed by deficits. Whether you love or hate the spending doesn't matter because we're not debating how much the government should spend or what they should spend it on --- we're only debating the financing. So taking it as given that the govt is going to spend $100 of your money on project X, the only relevant effect of deficit spending is that, instead of taking that $100 from you today, it puts that $100 back in your pocket, with an implied obligation that you'll have to pay back (say) $150 some years from now. That is a loan to you. The deficit is not "to pay for some expense" because the expense was going to happen anyway.
The difference between the corporation and the govt is that if the corporation does not borrow, it might not be able to spend --- because corporations cannot tax their shareholders. But your govt can tax you, so its spending does not depend on borrowing. The decision to borrow is not a decision to spend more; it is a decision to defer your taxes. In other words, it is a loan to you.
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Date: 2021-09-26 07:35 pm (UTC)Your second point seems to me to be entirely off the mark, because the right exercise is to compare government spending financed by taxes to exactly the same spending financed by deficits. Whether you love or hate the spending doesn't matter because we're not debating how much the government should spend or what they should spend it on --- we're only debating the financing. So taking it as given that the govt is going to spend $100 of your money on project X, the only relevant effect of deficit spending is that, instead of taking that $100 from you today, it puts that $100 back in your pocket, with an implied obligation that you'll have to pay back (say) $150 some years from now. That is a loan to you. The deficit is not "to pay for some expense" because the expense was going to happen anyway.
The difference between the corporation and the govt is that if the corporation does not borrow, it might not be able to spend --- because corporations cannot tax their shareholders. But your govt can tax you, so its spending does not depend on borrowing. The decision to borrow is not a decision to spend more; it is a decision to defer your taxes. In other words, it is a loan to you.