How Government Accounting Hides True Costs

The Fiscal Policy Podcast with Fexingo: Government Budgets, Stimulus, and Public Spending · Sep 4, 2026 · 10m · transcript

Most people think government budgets are simple ledgers, but the way Washington tracks money reveals a massive accounting illusion. We look at how cash-basis reporting masks long-term liabilities, turning future obligations into invisible debt that never hits the headline numbers. By examining the gap between outlays and accruals, we see why the true fiscal picture is far grimmer than the annual report suggests. This episode breaks down the mechanics of modified cash accounting and why switching to full accrual would change everything we know about public finance.

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