There is a reason you don't see much effect of Trumps incompetence; not yet anyway. It's because a country of over 300 million souls and a 14-15 trillion economy has a tremendous amount of inertia. But if trump does not get soon thrown out of office, or better yet into jail, you will see the ill effects of his term in office before long. For one thing steel prices are expected to rise steeply and that will have a ripple effect throughout the economy. get ready. Gird your loins! Outsize inflation is on the way. The only thing that will hold it somewhat in check is the lopsided accumulation of excess dollars being left in the economy. Were those dollars more evenly distributed, inflation would be worse. But it will still be quite noticeable 18 months from now.
The government spends money into the economy and taxes it back out. The difference is equal to the penny to either the surplus or the deficit. If the government runs a surplus for very long the economy will go into recession. If it runs big deficits for very long there will be inflation. The best the government can do is to balance the budget. That will hold the amount of money in the economy stable minus attrition. The normal course is reasonably small deficits, which can be sustained indefinitely so long as the population and production are increasing apace.
This seems simple enough until you realize that the most important factors are distributional and social in nature and have less to do with how much money is put into or taken out of the economy. How the money is spent and where it ends up become the factors ultimately determining the stability and lifetime of the Republic. It's bizarre to think of how much time is wasted on worrying about deficits and the debt of future generations when we should instead be much more concerned about getting our spending priorities right and correcting unsustainable distributional issues. It's these latter two factors that if not right will come back and bite us all in the ass.
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