Yet there will be limits to government borrowing as interest rates rise in the future. Just as today's low rates were not predicted by forecasters, the future path of interest rates is hard to predict, too. Higher interest rates could come sooner than expected as borrowers around the world increase their investments to take advantage of the favorable borrowing conditions. It's not at all surprising that foreign governments like Canada, the UK, Germany and Sweden, which have higher public spending as a share of GDP, also have higher taxation . But let us also be ready to raise taxes, especially as interest rates begin to rise and inflation and asset bubbles reveal the limits of money printing.

Source: CNN February 16, 2021 17:04 UTC