By way of introduction, direct government costs are cash expenditures by federal, state, and
local governments; the costs of future promised or expected expenditures are not included
until the money is spent. Indirect costs are expenditures or the equivalent incurred by
individuals and businesses in complying with government regulations and mandates, again at
all levels of government. The pros and cons of these expenditures is beyond the scope of this
article, which is concerned solely with the actuarial exercise of projecting future costs based
on an analysis of historical experience in the light of present and anticipated conditions.
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