Returns in the future?

I read an interesting post today. It covered the issue of our country's huge deficit, and posed the question of whether or not our children would end up benefitting from money being spent today at the expense of our ever rising deficit. The post claimed that we are taking out debt that will ultimately provide long term investment. I personally disagree. I don't believe that every dollar being siphoned from Saudi Arabia or Japan, etc. to finance our debt is being spent in the altruistic pursuit of long term investment. Billions alone are being used to finance war, which I don't consider to be any type of investment. This post made me seriously question our federal government's spending, and made me realize that my children won't necessarilly yield any benefit up the road from our country's current state of massive debt.


Dr. Tufte said...

I think for once we are seeing some clear-headed thinking about the deficit. The important question isn't whether we borrow too much or too little, but whether or not the money is spent on something useful. (This has always been the right question to ask, although it is tough to tell sometimes.) Anyone who couches the discussion in other terms is pushing you to buy into their position.

Isaac said...

Dr. Tufte stated that “The important question isn't whether we borrow too much or too little, but whether or not the money is spent on something useful”. I believe that in some ways this comment is true; however, there comes a point where the government needs to look at what are deficit will produce. Looking at whether a benefit is useful today sometimes detracts from the benefit we produce in the future. I believe that if we borrow, government should look at places where we can pull back. This would help control the debt problem that we face.

Dr. Tufte said...

This is backwards: your assumptions and biases are clear when you say "the debt problem we face".

What if it isn't a problem?

How would you know it it is a problem?

If you don't have a metric for that first, you can' jump to this being a problem.

If I said something like "This would help control the red-haired people problem that we face" you'd have no problem picking out that focusing on red-haired people is something worth looking at a bit deeper. But, we say "debt" and people turn off that critical thinking switch. This is a recipe for bad policy.