Doesn't this all depend on how you use that specific debt?

If you use the above example, if I can generate $500k each year using $1m in debt, how is perpetually serving the interest expense on that debt bad then?

Use it well, you can create additional profits. Use it poorly, you'll end up with nothing (or even lose capital).

Maybe you mean that the lever effect shouldn't exist, so that it's a zero sum game?