If you are looking for arguments against national debt, you can start with David Hume (1711 to 1776).

The great Scottish Enlightenment philosopher was a forward-looking, measuredly optimistic man who hoped for freedom and progress to pacify a warlike world.

Hume saw an important step in the abolition or at least a significant reduction in national debt.

Hume and other liberal fighters of the time, including Adam Smith (1723 to 1790), justified their rejection of strong state influence in the economy, not least with the increasing ability of rulers to wage war by taking on large debts, not least since the 15th century.

Gerald Braunberger

Editor.

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Hume was not a pacifist; he advocated the wars against the France of Louis XIV. However, he regarded numerous European wars in the early 18th century as unnecessary or unnecessarily costly. The Scot did not deny the useful aspects of public debt. He assessed government bonds as a useful safe capital investment, especially for entrepreneurs engaged in risky businesses. But overall, the disadvantages clearly outweighed them.

Hume's core message was: There is next to no possibility for a state to invest money in an economically sensible way. Hence the state tends to squander its money or spend it in wars. The indebtedness might be followed by bankruptcy, which might sweep the state away and establish tyrannical rule. “Either the nation has to destroy the state credit, or the state credit destroys the nation,” wrote Hume with a dramatic undertone.

The Scot also had a keen sense for the distribution of national debt. Rich investors living predominantly in cities would benefit, among them not only productive entrepreneurs, but also a “useless life” leading rentiers. The repayment of national debt through taxes, on the other hand, was largely the responsibility of the agricultural operators in the provinces, whose contribution to economic prosperity in a predominantly agricultural economy was considerable. National debt and the taxes necessary to repay it were not only unjust, but also detrimental to economic well-being. In addition, Hume feared inflation as a result of high national debt and a transfer of national resources abroad as a result of interest payments to foreign bondholders.

The idea that the state was incapable of productive investment continued to shape the thinking of the eminent British economist David Ricardo (1772 to 1823) a generation later.

He also believed that any collection of taxes to pay off debts was harmful.

Among other things, he feared an escape of capital from Great Britain to the young United States.

Ricardo's radicalism divides

With the radicalism of his fundamental thinking, after the end of the Napoleonic Wars, which were victorious for Great Britain but also very expensive, the end was: The exorbitant national debt, which at the time was estimated to be around 300 percent of economic output, was a huge effort in one fell swoop to repay. It was an unusual proposition for a liberal. Without the evils of national debt, economic life would normalize, he predicted, when England went through a period of weak economic activity.