How Government Accounting Hides True Costs

The Fiscal Policy Podcast with Fexingo: Government Budgets, Stimulus, and Public Spending · Sep 5, 2026 · 10m · transcript

We explore the hidden world of government accounting, specifically how off-balance-sheet liabilities and complex financial instruments obscure the true cost of public spending. Lucas and Luna dissect a specific case where a local municipality hid billions in debt through special purpose entities, revealing the systemic incentives that drive this practice. We look at why standard accounting rules fail to capture long-term obligations like pension deficits and infrastructure maintenance, creating a fiscal blind spot for voters and investors alike. This episode breaks down the mechanics of these…