A simple experience highlights an economic effect that greatly affects us all, and will continue to curse our nation into oblivion:
I speak of two tenants who recently moved into a rental unit I own. I made the mistake of renting the unit for one flat rate that included “free” utilities. Since the tenants didn’t have to pay directly for their electricity usage, they cranked the air conditioner day and night. There was no incentive for them to turn it off when they were at work during the day or away for the weekend. Whereas the electric bill for that unit averages about $50 per month this time of the year, their electric bill came in just under $200 per month – for the simple reason that someone else (that would be me) was footing the bill.
I got to thinking about this concept recently. It is the reason our government is so bloated and our deficit and debt (we just exceeded $20 trillion in debt a few weeks ago) are so high.
This is because millions of Americans like the concept of spending other people’s money [OPM] to benefit themselves – or, to be more precise, they vote for politicians who promise to give them things using other people’s money.
Source: Spending Other People’s Money