My 8 year old is in debt.

Hard to tell if this is a special one time "get into debt and earn money to get out of it" experiment, but if this becomes a permanent feature; in a few years time, when other people's teenage children will be mowing the lawn just because it's part of their life and the give and take of living with family, I wonder if these children will be telling their parents they don't need the money, thanks. Tidy my room? No thanks, I took a job at McDonalds so I don't need to earn money at home. Wash the car? Still got enough money to last until the weekend, thanks. Go to visit Grandma? That's going to cost you.

I wonder if, beyond that and into the rest of their lives, such children would have learned to associate doing anything for their parents as only being done for financial reward. If someone was doing this as an experiment to see what kind of familial relationships exist when a child has been brought up this way, I'd think they were in serious need of a visit from the ethics committee.

The use of financial incentives often displace a genuine interest and motivation to do such things.

Be wary of applying it too broadly, I think.