There very much are limits on how much debt a government can issue. The eventual response is that those holding large piles of these debts trade them for public assets and the public space becomes privatized. Aka oligarchy.
Your obsession with the word “debt” keeps you from fully understanding Treasury/Fed operations. The debt is an accounting function at Treasury that advises Congress of the outstanding currency, not a mortgage on our future. It is separate from Treasury bonds because it includes “all” outstanding currency, not just what is represented in bonds. Congress is Constitutionally authorized to create the nation’s currency, so it incurs no “debt” when it does so, regardless of any revenue it receives. Since the currency represents a tax credit “owed” to its holders the only way to “pay” such a debt is to impose a tax that “cancels” the currency.
To assume that taxes are applied to the debt entry that created them and survives that to “fund” anything isn’t logical or possible by any accounting standards. “Paying off” the debt, both forms of money, not just bonds, would entail removing all currency not yet canceled by taxation from circulation (impossible with a trade deficit) and defaulting on all private sector bank debt. That is not a logical goal to strive for but is currently the holy grail of politics. The fact that every time we made significant headway toward that goal, including Clinton’s surpluses, has resulted in an almost immediate recession or depression should warn them off, but politicians are not known for logic or aptitude for history.
Money takes two forms in the private sector, reserves, and bonds. They are interchangeable except that bonds pay interest. Because purchasing bonds requires the high power money that only Congress can create when it spends in deficit the bonds are already “paid for” via that spending. They are simply redeemed for reserves again when they mature, but at full face value while their purchase price is discounted by the interest rate the Fed determines. They are no more than a low yield asset swap that was used to draw down currency in the private sector, making it unconvertable to gold when we did that silliness.
Given that the high power money to purchase bonds already exists via deficit spending by Congress it isn’t logical to posit that bonds “fund” spending. Ditto with taxes. It is more accurate to say that spending “funds” both than the other way around. The monopoly issuer of the currency neither needs nor uses any “revenue” to enable spending. Both fiscal policy (tax) and monetary policy (bonds) only serve to regulate the money supply, not fund the government. The government “funds” the economy and is responsible to do so in a manner that serves the “common welfare” as mandated in Article 1: Section 8 of the Constitution.
If interest payments on bond issues are a problem (they aren’t) then we should discontinue bond issues. They obviously only present a problem in offering low hanging fruit to politicians pandering to common misperceptions among voters. Some economists advocate for discontinuing bond issues to prevent political pandering, but others recognize that more mischief is likely with only private sector investments available to the wealthy oligarchs who are more concerned with protecting their wealth than creating more. Bonds offer them a floor for investment yields which is why no bond offering has ever been refused at whatever rate the Fed sets. Dollars never leave the Federal Reserve banking system and the only option other than bonds for excess reserves is to leave them in reserves.
We can’t fund economic or population growth or sustain trade imbalance unless we recognize that the money supply must also grow to enable wealth accumulation, store of value, and to retire private sector debt. Is $22 Trillion too much total “net” currency (not offset by private bank debt) to have in the economy? We can, and should, have that conversation, but that will have to include distribution as well as quantity, and be discussed in the context of functional reality, not myths based in the errant application of household budget logic not applicable to the currency issuer.
