When our prevailing economic framework would have us connect dollars to honor as closely as possible, then it follows that increasing debt levels would imply an honor shortage somewhere along the chain. Indeed one would be hard-pressed to come up with a more apt symbol of the unwinding of the honor of our political elites than the ballooning debt. We don’t need a graph of total global debt over time to illustrate the point: we all know about the issue, and some people still see it as a mounting problem.

While stock markets are more of an indicator of achievement honor of corporations, debt is more tied to foundational honor, as a promise to repay in kind. Which is why we say we honor our debts. When there is a mathematical/financial impossibility that the current situation can continue to worsen indefinitely, and a political infeasibility of addressing it head on, those circumstances erode honor throughout every level of our culture. It has become a cliche to say politicians spend like drunken sailors, and they do love to shower largesse on supporters. But are undisciplined appropriators the real underlying cause, or were we put on this track long ago? And is austerity really the answer? Or is it all fear-mongering about nothing?

The fact of the matter is that there are good debts and bad debts. Almost always the problem is not how large an outstanding amount but whether it was put towards a worthy end. Gambling debts, bad. Open a profitable business, good. If any entity or individual, governments included, stand to gain more over time than the future payment cost, then the risk and extra payments are worth it. Measuring the value of public goods in terms of benefits to citizens or higher tax payments can be a challenge. Although, it is often crystal clear when payments to some beneficiaries will not produce a lasting benefit for anyone else.

It is a head-scratcher for anyone to hold to the position that government doesn’t create wealth. Most of the time, that’s probably correct. However, there are situations where governments are the only game in town who are willing and able to fund large projects that are needed or spin out massive benefits. The U.S. Interstate Highway System, for instance, is used by millions of drivers and truckers each day to freely and cheaply travel between any city they like. In the last 5 years of Eisenhower’s term, the U.S. Government built over 10,000 miles of roadway, mostly from scratch, for a cost of $10 billion, reaching 25% completion of the final goal. The economic benefits alone have been many times that which means that even high interest bonds would have been paid for in spades by additional tax dollars resulting from the project. Of course, they didn’t, and ran a budget surplus during several of those years. Ike even had the guts to raise the gas tax! Because at that time leaders were more fiscally honorable, and conservatives were truly conservative.

(If that $10 billion figure appears laughably small when it costs that much to build four miles of NYC subway 60 years later, you’re not alone. We’re talking 1956 dollars, yes, but we’re supposed to believe that it’s the same as $100 billion in 2023. Still seems like a good deal? We’ll come back to the escalating cost of public goods at a later date.)

The closest comparison most make to today’s fiscal trainwreck is the 1940s. Aha, you say, that was spending on a destructive war, but still we grew our way out of that money hole. Which is relevant except for one thing: Winning World War II was the single greatest public good ever created in history. Its positive effects are literally incalculable, possibly infinite. Even if we ignore the impact on human suffering and well-being, the economic gains continue to be reaped. First, the saved cost of not having another war between powerful states. Two, the eventual increase in international trade alone dwarfs the costs incurred by all parties. All in all, the government can cause wealth to be created.

Which leads us to today. The budget shortfalls across nations, all the way to struggling households, can be traced back to decisions made by leaders over generations, not just the past few years. The size of that deficit is a direct result of malinvestment, wrong investment, no investment, in a country’s people. We knew for at least that long pensions would inevitably grow with older populations, which necessitates a more skilled and enterprising workforce. Public pensions should be, would be, in a safe position today had those leaders done so. Some countries understand the importance of public goods better than America. Very few countries have done what’s necessary to forestall these calamities. It therefore falls to us, to anyone reading this, to do the job. Whatever the cost, it must be borne, for the price of failure is far too steep and the potential reward far too great to ignore.