ABSTRACT
If there is a particular gauge of the failure of demand-management policies, it must be the federal debt. The growth of the debt and a general indifference to this growth were, until comparatively recently, aspects of Liberal doctrine that were scarcely ever criticized. Introductory economics textbooks devoted a few pages to discussion of federal debt but quickly moved on to other topics, leaving the distinct impression that "debt doesn't matter." In fact, the debt does matter. Not only is it the undesirable outcome of wrong policy choices, but annual operating deficits by the federal government and mounting aggregate debt also throttle an economy, encouraging inflation and general economic stagnation.
