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Valentine's Day gifts aren't good investments. Couples, and governments, should beware.

Cold, hard cash is less romantic, but it allows the recipient to get something they actually want.
Image: Be smart this Valentine's Day: don't give a gift.
Be smart this Valentine's Day: Don't give a gift.Chelsea Stahl / NBC News

Valentine's Day gift-giving is fraught. If you're in a new relationship, there's the question of whether you're "there" yet and whether a pricey purchase can make the object of your affection feel uncomfortable — or embarrassed about their more modest offering. If you're in the long-term comfort zone, the wrong gift can signal neglect or that you don't know your partner as well as you should. Sometimes a present can even be an insult: Surprising your special lady with an unwanted Peloton is a cringe-worthy mistake, and many a marriage proposal has gone sideways when the realities of the diamond trade were brought up.

Government is bad at shopping for us — it overspends, and its gifts are still so-so. Nobody could get away with them on Valentine's Day.

So while you're making your last-minute shopping decisions, you should consider skipping a gift entirely — opting instead for cold, hard cash. It's less romantic, but it's sure to allow the recipient to get something they actually want. At least, that's what economist Joel Waldfogel argued in his controversial book "Scroogenomics."

Waldfogel ruffled feathers in 2009 when he came out against gift-giving, lambasting Americans for "wasting" up to $13 billion a year on gifts that the recipients wouldn't have bought themselves. This "deadweight loss," as he called it, happens because most people prefer something they would have bought themselves to a gift they don't want.

Of course, Waldfogel's idea — that a gift is usually worth less to the recipient than the giver paid for it — is more popular among economists than lovers. After all, the University of Minnesota professor himself admits to still buying presents for his wife. Common sense tells us there's more to our Valentine's Day tradition of gift-giving than market exchange.

So we accept deadweight loss on the individual, microeconomic level because it's no big deal. The potentially infinite value of a human relationship is worth far more than the price of a new sweater. But the same effect occurs on the macroeconomic level, and there it has serious negative consequences — wasting billions or perhaps trillions of dollars with none of the emotional payoff that mitigates against mediocre Valentine's Day purchases.

Indeed, the government would do well to pay attention to Waldfogel's findings, even if couples in love don't. Tax-and-spend programs are simply presents from the government: gifts of schools and health care, with bloated bureaucracies to run them all. And like the unwanted Valentine's Day gift, this largesse from Uncle Sam is usually not quite what you were hoping for. Worst of all, it was paid for out of your own bank account.

Some left-leaning pundits and politicians are in denial about the negative consequences of these mismatches, claiming that because government intervention can be necessary, the more the better. But government is bad at shopping for us — it overspends, and its gifts are still so-so. Nobody could get away with them on Valentine's Day.

Just imagine: You're opening a lovely card from your beau, decorated tastefully with flowers, when you discover a terse note inside: "For your V-Day gift this year, I paid off a few of my gambling debts."

That's not a fantasy — it's exactly how government spending works. In my home state of Pennsylvania, for example, the Legislature budgets $1 billion to $2 billion a year servicing past debts. The House Appropriations Committee estimates the yearly cost at over $5,000 per family of four.

Sometimes these debt payments are literally for gambling, such as when the state government dumps billions into the horseracing industry to prop up a dying pastime, paying for outlandish cash prizes and trying to improve the state's reputation in the sport. A great deal of that money goes to out-of-state and foreign racehorse owners from Saudi Arabia, Canada and elsewhere. How can politicians justify raising state taxes when these payouts disappear beyond state borders?

Even when it stays in state, corporate welfare for favored businesses in the form of bailouts and incentives to Fortune 500 companies doesn't help create jobs or boost the economy. Opulent gifts like the attempted $5.7 billion in tax breaks and other incentives for Jeff Bezos to bring Amazon's HQ2 to Philadelphia leave taxpayers cold — it's not a gift they'd choose to spend money on if they were asked.

Government officials might think they're being sweet by furnishing a yoga room for our state senators or offering tax discounts for the latest M. Night Shyamalan movie. But you know what would actually sweep us taxpayers off our feet? A little more accountability in how our money is spent.

The framers intended Congress’ authority over public spending to make budgets accountable to the people — but nowadays they certainly are not, because most people don't know how to decode complex budget proposals full of earmarks, supplemental appropriations and special funds.

Voters can't all become budget experts, but they can support budget process reforms that require affirmative consent and transparency while clarifying the long-term impact of large expenditures. Forcing legislators to vote for a massive spending omnibus or shut down the government reduces their accountability for each expenditure.

We taxpayers should stage an intervention with our elected officials and tell them when we don't like their taste in presents.

Initiatives that save money while offering taxpayers more choice over how it's spent could also help prevent deadweight loss. For example, school choice options like charter schools or tax credit scholarships for private schooling can educate kids just as well or better, and more cheaply, than traditional public schools — and they're astoundingly popular across the political and socioeconomic spectrums. If the government wants to give families the gift of education, these programs would be a welcome choice.

Telling your partner you don't like their gift can be a sensitive conversation. But if you don't broach the subject, you could be in for many Valentine's Days of deadweight loss. In the same way, we taxpayers should stage an intervention with our elected officials and tell them when we don't like their taste in presents.