The Real Social Contract Is Between the Dead, the Living, and the Unborn

Added: 2026-05-27

[00:00:00]Edmund Burke's great insight, and admittedly, he was Irish, not Scottish, but we'll let him off, was that the real contract, the real social contract, is not between the classes, it's between the generations. And one of the great lines in the essay, Reflections on the Revolution in France, is that the true social contract, it's an anti-Rousseau point, so anti-French enlightenment, very good, we like that.

[00:00:27]The point is that the real contract is between the dead, the living, and the unborn.

[00:00:33]What public debt allows is for the the living to consume at the expense of the unborn.

[00:00:40]And that is a fundamental problem that comes about once public debt becomes institutionalized and you have large liquid public debt markets. I don't think there's any exception to this rule.

[00:00:51]All systems, regardless of whether they're democratic or undemocratic, engage in this.

[00:00:57]China is a radically different system in every way from ours. But if you look closely at the public finances of the People's Republic of China, there is as much debt in the public sector as there is here relative to gross domestic product. It's nearly all at the local level.

[00:01:17]And that is the Chinese, in just the same way, living at the expense of future generations. So I think this is not a peculiar problem of the of this republic, it's also a problem of the French Republic, it's a problem of just about every European country with the notable exception of of Germany and the Netherlands. I could go on.