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When budgeting, access to credit can be useful at points. The usefulness can be thought of as the difference between the consequences of not paying your debts now minus the consequences of either fulfilling or breaching your contract with the creditor. In a perfect(ly calculated) world, creditors would always be sure that the cost of the credit they extend is at least even for them, and everyone would plan such that they always have as much as they need. People make mistakes, the world is not perfect, and we find situations where the consequences of not getting something now outweigh the consequences of having less later. However, governments do not budget like most of us for two reasons:
- They don't, indeed CAN NOT, explicitly contract the consequences of defaulting on their debts.
- Since August 15, 1971, when Nixon unilaterally broke the gold standard, they operate with fiat money, which means there is no physical sanity check on how deeply they can compound their errors.
For these reasons, I argue that it is more important for governments to operate on an essentially balanced budget than it is for most of us. Most western governments have not been operating this way at all. I try to help individual investors at least mitigate the economic consequences of that with my subscription service.