In This Review

Freedom from National Debt
Freedom from National Debt
By Frank N. Newman
Two Harbors Press, 2013, 104 pp.

Newman, a former senior official at the U.S. Treasury Department, offers a primer on the vital role of U.S. Treasury securities in the global economy. In the process, he exposes as mere blather much of the what passes for sound discussion of U.S. public debt and the federal government’s debt ceiling, persuasively contradicting claims commonly made by deficit hawks. The U.S. government, whose securities are less risky than bank deposits, is not akin to an extremely large household, he argues, and its finances should not be evaluated as if it were. Near-term federal budget deficits are not a burden on future generations, as long as the borrowed funds are spent wisely and will result in more production. Foreign ownership of U.S. Treasuries does not pose much risk to the United States, and interest payments on U.S. public debt do not consume economic resources. This short book should be read by every journalist who covers economics and finance, every politician or policymaker who works on economic affairs, and anyone else concerned about the federal government’s role in the U.S. economy and the country’s financial system.