Not a useful argument

In a recent post, Syll quotes Abba Lerner:

Very few economists need to be reminded that if our children or grandchildren repay some of the national debt these payments will be made to our children or grandchildren and to nobody else. Taking them altogether they will no more be impoverished by making the repayments than they will be enriched by receiving them.

Lerner is making the "we owe it to ourselves" argument: "Taking them altogether they will no more be impoverished by making the repayments than they will be enriched by receiving them."

Taking the 99% and the 1% together, they will be no more impoverished by making the repayments than they will be enriched by receiving them.

But given growing inequality, "taking them altogether" is the wrong take.


Syll, in the same post:

Some members of society hold bonds and earn interest on them, while others have to pay the taxes that ultimately pay the interest on the debt. The debt is not a net burden for society as a whole since the debt cancel itself out between the two groups.

This is not a useful argument in a time of great inequality.