NPR’s Planet Money team has a report out about the brief moment in 1835 when Andrew Jackson proudly announced that the national debt had been paid off. As they explain, it didn’t last.
It’s pretty important to realize that there’s no reason the debt should be reduced to zero. Jackson was a crank who disliked both the idea of a country having outstanding debt and also the idea of paper money. But a modest national debt is an excellent thing to have. The future will be richer than the present, sovereign states are much more long-lived than people or firms, and states can increase their income by fiat in a pinch. Having a decent pool of creditworthy sovereign debt outstanding greases the wheels of private sector commerce in helpful ways and also gives people a useful low-risk savings vehicle. That’s not to say that a giant debt load is unproblematic or that it’s healthy to have a huge share of GDP going to interest payments. But there’s nothing wrong, as such, with a country having debt any more than it’s a moral failing for a business to avail itself of a line of credit.