Eli5: How does national debt pay bonds, but those bonds are then taxed?

Question

Does the tax go back into paying the bonds? Is this just a big loop in perpetuity?

In: Economics

Answer 1

It’s like when you owe your friend $20, but you babysit for them and get paid $20, and then you buy them a coffee using the same $20. It’s all the same money just moving around different pockets.