You're drawing a false equivalence. A dollar (or a gold bar) does not represent a specific amount of goods or services that any specific counterparty is bound to deliver. So in general no, money is not inherently debt.
> 4. If you believe the good times are going to keep rolling, and any bad times will, on average, pass relatively swiftly (people do have a tendency to persevere), then not borrowing money results in a lost opportunity cost.
On the flip side, creating inflation channels wealth up towards the top, to those who are able to better bear the burden of roundtripping through the inflating assets rather than saving in dollars. Plus the lagging effect of wages means that they only rise after the people earning them are feeling enough pain to demand more.
Even taking the CPI calculation at face value, it does not represent the whole of inflation. We would expect prices in a technological economy to be level or trending downwards, due to basic market optimization. Every time some innovation makes things "cheaper" and yet their real prices still go up, we're getting hit twice!
I'd say the long term effects of centralizing the economy (ie the wealth imbalance we're dealing with now) are more harmful than forgoing a little top-down metric of "growth". We have a "shortage of jobs" precisely because people at the bottom are still stuck chasing 40 hours a week to service debt, rather than having been able to build wealth (ie economic negotiating power) in dollars.
And of course all that too-hot "growth" is occurring by churning through real natural resources, suboptimally even. If you care at all about sustainability or global warming, and you don't look at the US's monetary policy and weep, you need to study deeper.
This is confused. A dollar is a debt/credit dual created by central bank and private finance operations.
A dollar is a unit of monetary accounting, a physical dollar is a token representation of a debt/credit entry inside an accounting ledger.
A bar of gold is a commodity denominated in a monetary value. It is not a token representation of a state enforced contract.
What I was refuting was OP calling all currency in general "debt" based on it having little "intrinsic use", and therefore only useful for what it can be traded for.
It's a pragmatic concern inasmuch as the lenders's "faith in [the government's] ability to service the debt" in step 2 is not infinite. If you lose that faith, you have to (a) raise rates, (b) impose capital controls, (c) raise taxes and/or (d) force your central bank to monetize the debt. Each of these do bad things to the economy. The national debt isn't like household debt because the government is immortal, but that doesn't mean it's meaningless.
Suppose you have a really nice condition Jackson Model C, and, because you're a crazy person you've been driving that damn thing every day since you bought it last century. Unsurprisingly the Jackson is not very reliable, and so you sometimes drive it to the garage where it can be repaired. Now alas the dry batteries in your Jackson are its weak spot, and you find they must be replaced every 100 miles or so. The garage is two miles away.
After you've driven 2000 miles in your Jackson Model C, much of that time with antique car enthusiasts yelling at you that it belongs in a museum, you have replaced the battery about 20 times, each trip to do taking four miles (there and back) and so 80 miles.
I observe that you've used 80% of the life of a battery just on driving to and from the garage to replace the batteries.
Like this 55% of national debt statistic, my observation is at once true and completely meaningless.
2. True, but NOT in this case. The US government finances it's own debt. So the US borrowing more does NOT represent a willingness (of anyone but the US government) to borrow to the US government. This is true for most/all governments worldwide.
3. True, with MAJOR caveats. If we're talking about 5%, -5%, then sure. If we're talking about a 50% shortage, then we're in the danger zone. If a government finances it's spending to a significant extent ... well there's no historical examples of it ending well. Even "when it works" it's very bad for the people living under such governments. Likewise, it's very bad for a government to run a large surplus.
So 3 only applies for "small" values of unbalanced.
4. Sadly, not true. This is a myth coming from the fact that the financial world effectively rewrites history to "erase" bankruptcies. If you reintroduce them it becomes clear that if you owned a global debt index, say, you'd be screwed.
(so, sorry mr. Bogle, you're only right for very recent history (given "too big to fail") and frankly, you know damn well that you're wrong for the long term).
1. All money is debt insofar as it only represent goods as services yet to be rendered, an I Owe You as it were
2. If an entity is able to continue borrowing (more and more) money it represents a willingness of lenders to lend, which is a direct representation of their faith in that entities ability to service the debt
3. Whether a nation-state should balance it's budget is more a philosophical question coloured be ideology rather than a pragmatic concern.
4. If you believe the good times are going to keep rolling, and any bad times will, on average, pass relatively swiftly (people do have a tendency to persevere), then not borrowing money results in a lost opportunity cost.
I'm sure someone can respond with some equally convincing reasons as to why nation-states shouldn't run a deficit.
Go!