https://tradingeconomics.com/sweden/government-debt-to-gdp
For example Sweden where I live has reduced their government debt to GDP ratio pretty consistently the past 25 years, and I haven't noticed any problems with it. People saying that we would have problems if governments balanced their budgets are just big fat liars.
In fact reducing national debt through taxation is an effective way of reducing inflation. Reducing national debt does not mean the economy will fail.
The economy is not a binary system ("success", "fail"), so the more interesting question to me, is whether Sweden's economy would have done better if they had chosen a different economic policy
You essentially block yourself of improving yourself by realising you might be wrong about something
It sounds to me like you think of a national economy as a household budget. Taxes are income and welfare is expenses, you take loans from banks, which have interest and needs to be paid back or you get punished
It's a nice and simple explanation, which also happens to be 100% wrong
Government debt have no interest and there's no creditor who needs to be paid back. Whenever the Swedish government prints 100 crowns, it goes 100 crowns more into debt
Whenever it gets 100 crowns in through taxes it resolves 100 crowns of debt
National debt is not the same as private debt. They're two completely different things, that unfortunately have kind of similar names
National debt is simply the amount of the national currency in circulation. To be "debt free", Sweden would have to remove every single crown from circulation, which obviously is not a good idea for the economy
Additionally - the government does not use taxes to fund spending. Swedish crowns are essentially worthless to the Swedish government, because they own the money printing press and could make infinite money if they wanted to
If parents setup a system for their kids, where they get small paper notes for doing chores, which can be traded in for the daily WiFi password, the notes have no value for the parents and the WiFi would work without the kids paying chore notes, but they're still useful because they facilitate the "doing of chores" and have value to the kids because of the "WiFi tax"
In other words the purpose of taxes is to create demand for the currency to match the supply the government is creating by printing more money. By having a demand for the currency, the government can use it to pay people to do "chores" it wants done by simply turning on the money printer, then collecting taxes at a later date