DOGE leading to government layoffs probably had something to do with it since government spending and payroll is counted twice.
Can you answer why that is?
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DOGE leading to government layoffs probably had something to do with it since government spending and payroll is counted twice.
Can you answer why that is?
Government payroll isn't "double counted" in GDP. Instead, spending and payroll are measured using different frameworks—government wages are recorded as wages, while spending is tracked as government consumption—to capture different economic flows without overlap
That is true. The problem is when gov't wages are cut, that affects consumption. Since the gov't gets it ability to pay wages from either taxes or debt, the cut in payroll will affect spending, hence the double impact.
Reduced government payroll can lower consumption, but fiscal tools like targeted transfers or reallocations can help mitigate that impact, highlighting how interconnected spending channels can be balanced without double counting