How will politicians escape enormous public debts?

The world’sGDPGGDP imfimf public finances look increasingly precarious. In the year to July America’s federal government borrowed $2.3trn, or 8.6% of —the sort of deficit usually seen during economic catastrophes. By 2025 five of the 7 group of big rich countries will have a net-debt-to- ratio of more than 100%, according to forecasts by the. Such debts may have been sustainable in the low-interest-rate era of the 2010s. But those days are long gone. This month the ten-year Treasury yield briefly hit 4.3%, its highest since before the global financial crisis of 2007-09.How will governments shed these burdens? Economists are increasingly gripped by the question. A recent paper by Serkan Arslanalp of the and Barry Eichengreen of the University of California, Berkeley, presented at America’s annual monetary-policy jamboree in Jackson Hole, Wyoming, on August 26th, sets out a menu of options. It is not exactly an appetising one.