Is the national debt a good thing or a bad thing?

[Nomad84]

I don't really want to get into a discussion involving the government borrowing to pay debt or otherwise never truly reducing the debt (and therefore making it irrelevant). What I do want to discuss is whether or not carrying a substantial national debt is a financially wise thing to do. I bring this up because I've always thought of the national debt as a bad thing and I've always thought the budget should be balanced. But should it?

I suppose I should explain the series of opinions or realizations that led me to ask this question. First, on a personal level, I've always thought it wise not to spend money I didn't have. This is/was for several reasons (financially), but the most important two were that (1) anything I buy now with borrowed money will decrease in value - sometimes to zero, such as for services - and yet I will still have to pay for it based on its original price, and (2) I had no income or little income that I could count on to pay off the debt. Now that I am out of college and in the "real world", my views on debt are different. I think most of us can agree that buying assets that are expected to appreciate in value (ideally at a higher rate than the interest rate of the loan) can be a wise use of debt. The same can be said about using borrowed money to start or grow a profitable business. My outlook on debt has also changed as a result of stable job that generates sufficient excess income to easily make debt payments if I decide to borrow money.

So what does this have to do with the national debt? I wonder if carrying a national debt is really a bad thing. If borrowing can allow us to start, grow, or maintain a business for financial gains, can it also allow us to start, grow, or maintain government programs that benefit us financially (or more directly, to provide assistance or incentives to businesses for the good of the economy)? I guess I don't see why not. Are we leveraged enough? Maybe we could see more benefits by using more leverage, although at some point that may raise risk levels to unacceptable levels. Would it be a (somewhat) fair comparison to look at the national debt (about $9bn) as a percentage of GDP (about $13bn) and compare this ratio to a variety of businesses (and their debt/annual earnings ratio)? I'm not really sure where I'm going with this other than I'd like to see some discussion as to why the national debt is good, bad, or neither and whether it should continue to grow or stop growing in the future.

I'm curious to see what you guys thing [img]/images/graemlins/smile.gif[/img]