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The myths and realities of America’s debt

FORTUNE — The annual cost of debt service will more than double in the next six years, rising to about $7,000 annually for the average American household, according to the Congressional Budget Office’s recent forecast. Nonetheless, the substantial increase in debt envisioned by President Obama’s budget, released Tuesday, has prompted little controversy. Republican congressional leaders have already adopted a budget resolution and increased the debt ceiling in a manner allowing the use of debt to fund routine federal spending.

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The President notes that deficits have come down at a faster rate than at any time since the end of World War II, as might be expected at the end of the two wars and recovery from the severe recession beginning in 2008. But after the World War II peak in debt, the U.S. immediately balanced its budget and often had surpluses. In the next two years, in contrast, debt will be used to fund over a quarter of the federal funds budget — that is, spending and revenues apart from trust funds.

Other creative explanations of federal debt have been repeated so often that they have become conventional wisdom. While everyone is entitled to their own opinion, not everyone is entitled to their own historical facts. Consider the following myths:

Myth #1: The federal government never balances its budget.

In fact, for the nation’s first 180 years federal elected officials borrowed for only four extraordinary purposes — waging war, plugging budget holes during downturns, expanding and connecting the nation’s territory, and preventing states from leaving the Union. Congress usually paid down debt after each emergency.

Myth #2: It all started with the New Deal.

The federal government borrowed during severe downturns beginning with the Panic of 1819. In his first year in office Franklin Roosevelt cut “normal” federal spending. Throughout his presidency he vetoed a record 665 bills in an attempt to maintain fiscal discipline.

Myth #3: Social Security is the real problem.

The Social Security trust funds are in great shape compared to the federal funds budget — that is, spending not fully funded by revenues dedicated to trust funds.

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Myth #4: Partisanship is the real problem.

Partisanship today is mild compared to the situation after the Civil War. Democratic and Republican leaders then routinely blamed each other for the deaths of millions of Americans, yet still cooperated to produce surpluses used to pay down Civil War debts. In recent years party leaders have often compromised. Those compromises, however, have tended to increase debt by raising outlays and lowering tax revenues.

Myth #5: The War on Terror and the Great Recession led to today’s debt crisis.

Traditional emergency uses of borrowed funds — fighting two wars and filling budget holes during a downturn — account for about half of the debt incurred between 2001 and 2014. Since the budget last balanced in 2000, debt has been incurred to finance tax cuts, higher military spending apart from the direct costs of war, and the rising cost of Medicare.

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Myth #6: Balancing the budget will hurt the economy.

Gains in the size of the workforce, investment and productivity — rather than greater debt — drive long-run economic growth. The U.S. economy has often flourished when federal budgets balanced. In contrast, after the federal government borrowed massive amounts beginning in 2001, private sector job growth lagged far behind historical averages.

Myths about federal borrowing may embellish partisan narratives, but they undermine accountability. And poorly defined problems are always more difficult to solve.

Bill White is author of the forthcoming book, America’s Fiscal Constitution: Its Triumph and Collapse (PublicAffairs, April 2014), and is a senior advisor to Lazard. He was mayor of Houston from 2004 to 2010 and served as U.S. Deputy Secretary of Energy from 1993 to 1995.