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Our Debt to Future Generations

No one argues that policymakers should not think about future generations. But, rather than focusing narrowly on financial debt, we should consider what kind of world we are bequeathing to our descendants, and what current policies and fiscal commitments will better serve their interests.

NEW YORK – Conservatives often make a big show of worrying about the debt burden that we are passing on to our children. This moral argument featured prominently in congressional Republicans’ refusal to support a routine increase to the US debt ceiling. The GOP supposedly is so committed to reducing spending that it is willing to hold the global economy hostage and risk permanent damage to America’s reputation.

No one argues that we should not think about future generations. The real question is what current policies and fiscal commitments will better serve the interests of our children and grandchildren. Viewed from this perspective, it is clear that it is the Republicans who are exhibiting a reckless disregard for the consequences of their actions.

Anyone with economic bona fides knows that one must always look at both sides of the balance sheet. What really matters is the difference between assets and liabilities. If debt increases but assets rise even more, the country is better off – and so, too, are future generations. This is true whether one invests in infrastructure, education, research, or technology. But even more important is natural capital: the value of our environment, water, air, and soil. If our air and water are polluted and our soil is contaminated, we are passing on a greater burden to our children.

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