No one is saying you should be banned from digging holes. The point is: if too much capital keeps flowing into holes instead of hospitals, bridges, or innovation, the economy produces less long-term value. That imbalance is what we call a misallocation of capital.

In other words: criticising waste != demanding central planning. It just means recognising that not all spending contributes equally to future prosperity.

>if too much capital keeps flowing into holes instead of hospitals, bridges, or innovation, the economy produces less long-term value [...] not all spending contributes equally to future prosperity.

Mmh... In an absolute sense, sure, there are actions that destroy wealth. Like I if I buy huge reserves of minerals and smelt them together so someone else has to spend vast amounts of energy to recycle them back into a usable form, that's definitely harmful. Or as a more realistic example, if I build a factory to churn out millions of worthless gadgets no one wants, where the raw materials could have been put to something useful. These are things that objectively lower the total wealth of the planet, because they increase entropy, which requires more energy to reverse.

But if I dig a giant hole... I don't see how the same applies. If nothing else, I paid for the wages of the workers. How is the world poorer after I spent a trillion dollars to keep a few million workers busy for a few years? To bring this conversation around, in what way does a player transfer make the world poorer?