Yglesias doesn't buy Matt Continetti's division of government spending into investment and consumption. He argues that "the political convention is to use 'investment' to mean 'spending I favor' whereas 'out-of-control spending' means 'spending I oppose'":
Medicare is obviously a heavy subsidy for old people’s consumption of health care services. But that, in turn, constitutes a heavy subsidy for medical-related R&D spending. America has the world’s most bloated health care sector but we’re also world leaders in pharmaceuticals, biotech, medical equipment, etc., and I doubt this is a coincidence. Any kind of in-kind social welfare provision is in part a form of industrial policy. In the classic Milton Friedman critique of the welfare state, this is a problem. But in the Continetti/Brooks/Salam reformulation of the critique, it ought to look more like a feature. I wouldn’t swing 100% to the “just send money” side of the argument, but on the whole I think Friedman has the better of the argument.
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