James Joyner suffers innumeracy

Here he is trying to determine if the cost of a house is accrued at the time build or amortized over years. The implication is that, in the aggregate, we have debt/spending cycles in the economy:

If a family buys a house, we don’t treat it as a one-time expenditure; we amortize it over the length of the mortgage. Doing it this way, then, not only goes against the way people think of spending but also has the double whammy of counting interest payments as a cost while pretending that we haven’t taken out a loan.

It makes a difference to James because he is trying to figure out how it takes until Aug 12 to pay all our government bills. James thinks the Center for Fiscal Accountability is assuming:

They they’re treating borrowed money as if it were due now. Outside the Beltway

I have news for James, borrowed money is due now by subtracting that money from current expenditures. It make no difference whether the money is debt creation, or backed in full by savings, it is money taken out of circulation, and thus spending deferred today for other spending taken today.

So when the economy spends enough to cover government,then the economy is computing a pretty good estimate, and the date is about Aug 12, this year. Economists are still hung up on time.