FIRST: Ever since the days of Alexander Hamilton, investors have regarded the debt of the U.S. government as a very valuable and safe asset. In all but rare and exceptional times, the only return return debt purchasers and holders have demanded from the U.S. government is that it maintain the real value of the wealth they have entrusted to it. The U.S. government should invest this wealth wisely and prudently, yes, in the highest societal-value projects, yes. But the main consideration and the bottom line is that—except in the 1870s and 1880s, and in the 1980s—the U.S. government has never faced a debt-financing constraint as long as long as its investments yield any possible positive return in the form of additional taxes collected downstream at all. Worried that this may change in the future if interest rates rise sharply? Then issue inflation-adjusted consols, and lock in real debt payments permanently:
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