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Thank you for this. I don't think you've told the whole story here - for example, when it comes time for the government to pay the future debt they can do it b

Thank you for this. I don't think you've told the whole story here - for example, when it comes time for the government to pay the future debt they can do it by raising taxes on one part of the population or the other, or simply by printing money (leading to inflation) and not all of those solutions work out the same way for any given person. Even so, you've shown me a more sophisticated way to think about this issue and I'll surely end up having different, better founded opinions as a result.

nostrademons 7y ago
Inflation is itself a form of transfer payment - from creditors to debtors, and from people in markets with no pricing power (high competition) to people with high pricing power (no competition), and from cash-holders to asset-holders. You're right that this has very different winners & losers than just paying interest on the debt, but it's the same general principle: government debt and money itself are both fictions, so the only way they can influence aggregate welfare is if they disincentivize productive work.