One of the primary obstacles facing Progressives is the tendency for voters, politicians, and pundits to moralize economic issues: Debt is evil, spending is bad, taxation is theft, government assistance encourages laziness, depending on others is irresponsible, ect.
Personally, I think economic science should be the guiding light of economic governance, but I think it's worth pointing out that elite consensus on the Federal budget has anything but a moral foundation. And don't just take it from me, ask Jesus.
For those of us that didn't attend or weren't paying attention at Church, Jesus has a teaching known as the Parable of the Talents. The basics of the story is this: A king, or master, entrusts a large sum of money to his servants, telling them he'll be going away for year. When he returns he asks his servants for an accounting of the money. Two of the servants explain that they have invested the money and earned back a return. Each are rewarded. The third explains that he is very risk-adverse and simply buried the money in the ground. His master calls him a 'wicked and slothful servant' who he has thrown into the 'outer darkness.'
The lesson is pretty clear: use your talents, use your opportunities, don't waste them and let them sit idle. Jesus' moral teaching here is that Christians shouldn't squander their God-given gifts, rather they should use them to benefit the kingdom of God: it is immoral to waste opportunities given to you. But there is also an economic lesson - sticking your money in the ground is a sub-optimal investment strategy.
What does this have to do with the Public debt? Well, in the Jesus' parable the master essentially gives his servants a no-interest loan, payable in a year. It shouldn't be hard to make money on a no-interest loan - it's quite the opportunity. The Federal Government has a similar opportunity.
Right now the yield on a CPI increased 1.6% between Jan. 2012 and Jan. 2013. So lenders get 1.78% return, but 1.6% is eaten by inflation. The 'real' rate of return is almost nothing: basically the Federal Government can borrow money for free. This simple fact is rarely mentioned in any discussion about the budget or deficit reduction. Elite pundits, conservative and moderate politicians, and 'everyone' in Washington, seems completely oblivious to this fact.
What are the moral implications? Well, Jesus says the servant who does nothing with his free money is 'slothful and wicked.' The focus on deficit reduction, in light of 'free' borrowing costs, is also 'slothful and wicked.'
Are we really led to believe that their is no investment, no spending, that can justify a no-interest loan? A working person is infinitely more productive than a unemployed person. Occupied housing is infinitely more productive than empty housing. Operational factories are infinitely more productive than closed, idle factories. And there are plenty of idle resources (including labor) in this country today. Is there no way for the government to spend (free) money to make these things happen?
Spent wisely, this money will not be difficult to pay off. And by wisely, I mean the rate of return has to be better than one-tenth of one percent, annually. That is not a high bar.
God has given us a wonderful gift in extremely low bond yields. We are compelled to use this gift wisely, yet, the 'economic moralists' among us prefer to bury it in the ground.