ABSTRACT

A growth of the money national debt that merely keeps up with the growth of the money national income, whether that growth be due to growth of real output or to an inflation of prices, will not cause any extra burden of this kind. Nor will a growth of the national debt that is incurred in order to finance real income-bearing capital assets in the public sector cause any undesirable incentive effects of the kind described above; the wealth indirectly owned by the individual owners of the debt is producing real income from which the individual citizens are in fact enjoying a real advantage in one form or another.