State Debt: To what ends and to what purposes?
According to an eighteenth century thinker Giambattista Vico, humans tend to project their reality to the unknown; they tend to anthropomorphize nature. The same thing might be said with regard to societies. Humans tend to wrongly presume that society, as an entity, is akin to the individuals out of which they are composed. US President Herbert Hoover did this during the recession of the late 1920's, and sadly he was not the only one. The severe fiscal situation led many to falsely believe that the US government should 'balance the budget', hence dictating a policy which reduced the state debt but which ultimately worsened the economy, leading to the Great Depression. Yet, if state debt is good, to what extent should a state practice this policy? After all, too much debt is still, well...too much debt. African and Latin American government have typically overburdened their societies with so much debt, making it more difficult for them to develop. The fine art of economics must constantly make a balance between the too much and the too little.