The Debt Debate

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Debt can be ruinous if it is used to finance deficits without no plan to pay the debt.

Debt for government spending should meet three independent conditions: benefits greater than costs, projects the private sector cannot control, and sustainable debt level.

The interstate highway during President Eisenhower’s administration met all conditions. The benefits vastly exceeded $450 billion in today’s dollars, only the federal government could have completed the national project, and debt to GDP ratio was sustainable.

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