The reason I'm asking is that we always assume that deficit spending is stimulative in nature, but we forget sometimes that this money came from somewhere and that if it weren't lent to and then spent by government, it would have been invested somewhere else. Perhaps it would have been invested elsewhere in the world, but with home bias. Probably a large share of it would have been invested here.
I know that, for example, in the Israeli context, one of the great stimuli of the start-up nation, as it's called, was that the government just stopped borrowing so much money. Pre-institutional investors couldn't get 6%, 7%, or 8% by simply buying government bonds. They actually had to invest in productive assets. That's one of the reasons there is an enormous tech boom in that country.
Have you thought at all about the substitution effect of lending to governments?