As Americans celebrate Cinco de Mayo, the date of the Mexican army’s defeat of occupying French forces in 1862 at the Battle of Puebla, let’s hope history doesn’t repeat itself. The French were prompted to invade after the Mexican government reneged on debts incurred after the Mexican-American War and a series of other internal wars.
While the U.S. (hopefully) doesn’t have to worry about other nations invading our territory if we renege on our debt, the circumstances surrounding the French invasion of Mexico should remind us that lenders take debt payments seriously. They aren’t abstract numbers; it represents money we owe others, including international investors. Letting the U.S. national debt climb won’t prompt military action, but the international financial repercussions could be serious, especially if rising taxes choke off private investment and future growth.
— Samuel R. Staley is Robert W. Galvin fellow and director of urban & land use policy at the Reason Foundation.