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Ask the Hammer: Should We Worry About the National Debt?

Jeffrey Levine, director of advanced planning at Buckingham Wealth Partners, discusses whether Americans should worry about the national debt.

Should we worry about the national debt, and the effect it might have future generations of Americans?

That was the question posed by a Retirement Daily reader to Jeffrey Levine, director of advanced planning at Buckingham Wealth Partners.

"There is certainly no one answer on this," he said. "Economists have widely different views."

According to Levine, there are two primary schools of thought. In one camp, experts such as Larry Kotlikoff, a professor at Boston University, believes that the total U.S. national debt and obligations is more than $200 trillion, and puts future generations at risk. (According to Investopedia, the national debt level of the United States - or any other country - is a measure of how much the government owes its creditors. The U.S. national debt reached a record of $24.22 trillion in April 2020.

In the other camp are experts such as Stephanie Kelton, author The Deficit Myth and a proponent of modern monetary theory (MMT). That theory "essentially says it (the national debt) doesn't really matter when you're issuing your own currency," says Levine.

According to Levine, what modern monetary theory argues is that the national debt matters less than how well inflation is controlled. 

Ultimately, Levine believes that the national debt isn't "as critical of a concern as a lot of people make it out to be."