Our National debt could lead to the next Great Depression, if production decreases, and consequently tax payments would decrease. It could also happen if our credit holders decide to call in the debt.

Personally I'm not 100% sure we'd go into a Depression based only our National Debt. It seems to me like the Dust Bowl played a pretty big part in the great depression. I think that the people of America will continue on with or with out the dollar- as long as we have the ability to produce goods. And let's face it, America is a great place for agriculture.

I think politically we'd be in a huge mess if people called in our National Debt. I think on an individual level we will find a way to survive even if it means working on a farm. Other countries tend to be less innovative than Americans (or is it because we have better technology?) But when it comes right down to it, we all have the need to survive, and even if it's hard I think we'd make it.

From a different point of view- as a society, America actually owes more than our Government with consumer debt, personal loans, and mortgages. Paying interest for products that we've already consumed, is more likely to put us into another depression. Of course, consumer debt combined with National debt could probably do it to. Just a thought though...
Source(s):
Macroeconomics 7th edition by David Colander
Personal opinion

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I think it's a big stretch to hypothesize that any amount of debt would cause an economic depression, just by being there. What generates big crisis are usually problems with consumer confidence.

The debt if a big problem, yes, because in the long run the US will be trapped by foreign countries, that hold that debt, and will have to pay increasingly bigger amounts just for interest. That puts pressure on the budget, specially on inflation, and will demand that government spending keeps to a minimum.

But i don't see how debt could relate to a depression. At least, not directly.
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