Entrepreneurs have balance sheets, profit and loss statements, etc. to keep an eye on their money. But government agencies have budgets. They spend more than they have, and they don't keep an eye on the money. Why? It's not their money, so they don't care how it's spent.
As you can read in this article, here's yet another example of how the government spends billions of our dollars but really can't account for it. Hmm, I wonder how long McDonalds would have stayed in business if they treated their accounting this way?
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2 comments:
Prof. Scott,
Had a question that I hope you might cover. Recently read on Lew that in '63 gas was $.25-.30, now since moving from sound money, it's 3.99. But that the '63 quarter was 1/5 oz. silver, or about $4, insinuating that gas hasn't risen in price, that our dollar has plummeted in value.
Here's the question: is there ever an example of a country moving away from fiat money or the bretton woods or whatever back to sound money through political reform? Or is political reform of that nature a practical absurdity?
ike
I don't know of any country that moved to the gold standard and away from fiat money in the last century. I'll do some research!
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