The Pied Piper of Hamlin is an old legend from hundreds of years ago, but it is a story with a timeless lesson. The town had a terrible rat infestation, and the Piper made an agreement with the townspeople that, if he played his music and got rid of the rats for good, the villagers would pay him a sum of money. When he had done his part and got rid of the rats, the people refused to pay. As revenge, the Piper returned and did the same with all of the children in the town and they were never seen again.

For many decades, the United States and many other developed countries have been listening to the seductive music of the piper, the lure of free stuff, of everything for everybody, of the rights to goodies with no responsibility. Welfare for the rich is just as big a burden as welfare for the poor, and bloated government programs keep getting fatter and fatter. The response might be that the economy is doing well in spite of all of the spending, with the stock market up in the stratosphere, with low unemployment, and an increasing GDP. As true as that might be right now, this is not the permanent state of the economy, just as every boom before was not the new normal.

The boom that we are experiencing is the result of an expansionary monetary policy, where inflation is detoured to the financial markets because of perverted incentives of low interest rates, caused primarily by the method of monetary expansion. There will come a time when the non-permanent balloon will burst, but the permanent programs and expenses put in place do not bust. There are few things that are as permanent as a temporary government program.

People often point to Sweden and other Scandinavian countries as examples of where socialism and big government have succeeded. That view is simply a snapshot of what can be seen today. The dynamics of history tell a very different story. Sweden developed into a modern, prosperous, relatively wealthy society with vibrant markets, innovation, and profitable businesses. In the 1960s, the country began redistributing wealth with a steady march toward “real socialism,” the kind of real socialism experienced by the likes of Venezuela. The nation was on the brink and in the 1990s, the nation reversed course, cutting government spending, shrinking government, and giving up on economic central planning.

Sweden still has a sizable welfare state, but it had re-embraced capitalism and market-friendly policies. It has stopped devouring the capital built up during the years or relative freedom. The 2019 Index of Economic Freedom lists Sweden and the 19th most free countries in the world. It has managed to regained some of the vibrancy that it had. It was lucky.

The United States official debt is now just shy of 100% of total gross domestic product, and is continuing to grow. The interest on that debt is almost a half a trillion dollars per year, and that is at the ridiculously low interest rates, which cannot remain that low forever. When rates go up, the interest payments will balloon.

The trajectory that the country is on is not a good one. The near-term economic outlook remains fairly good, but it is built on faulty premises. The current interest rates are what would be expected at the bottom of a business cycle, based on the idea that the economy needs a boost from “stimulation,” not at the top of a boom. Eventually someone is going to have to pay the piper, or he will get his revenge. We will all bear the burden of that revenge, regardless of whether or not we benefited from his seductive song.

Dan McLaughlin is the author of “Compassion and Truth-Why Good Intentions Don’t Equal Good Results.” Follow him at daniel-mclaughlin.com