And what do you mean by "sacrifice the wealth of future generations for the sake of the current"? The government issues bonds to pay for stuff. Then at some point :) the bonds presumably become due, and future generations have to pay it back. Whom do they pay it back to? Isn't it back to themselves? Even assuming there's some proportion of foreign debt holders, they're getting paid back in the currency of the issuing state, which currency has generally deflated more than the bond rate over time, in other words effectively an interest free loan. If you could get a less than base inflation rate loan for 20, 30, 50, 100 years wouldn't you take it? Even assuming the 100 year horizon and thus the loan was to paid back by your estate, don't you think there's a good chance your estate would come out ahead after having paid back that low interest loan than if you had never taken the loan in the first place?
I'm just saying I'm not fully convinced that taking on national debt is universally bad, if it's payable in the sovereign currency.
I don't disagree with your overall point about sacrificing future generations for the current, but this specific point is probably true regardless as luxury often takes time to acquire.
From an adequate distance, fraction reserve banking looks a whole lot like a ponzi scheme.
Interest-paying debit can be quite healthy. It does not have to be a ponzi scheme.
The 2 phenomenons are very different, if you trace monetary movements from one economic actor to another. They are not even close. It's like comparing a hat and a car.
https://www.investopedia.com/terms/f/fractionalreservebankin...
"Banks only need to keep a specific amount of cash on hand and can create loans from the money you deposit. "
So a bank can loan out more money than it has to loan. In addition to creating money out of thin air, that loan will accumulate interest fees.
It gets even worse when these loans are made to another bank who will loan that money out again.
No, let's look at this system, as I said, "from a distance." The entire system has X number of dollars in it and Y amount of loans. It doesn't take long and the amount of debt exceeds the amount of actual dollars that exist in the system. That is to say, there isn't enough money in the system to pay all of these loans back.
It's worse than a Ponzi.