With the pandemic, public debt has soared around the world. In the United States, as in Europe, ambitious investment plans will nevertheless be implemented… which will further increase public debt. Are our governments oblivious… or on the contrary, do they realize they have a role to play? Answering this question, at a time when Europe is preparing to revise the rules of the Stability and Growth Pact, is essential.

Candriam Economists Anton Brender, Florence Pisani, and Émile Gagna contribute to this debate by putting the rise in public debt into its proper context: that of economies in which the money households set aside leads to a demand for debt. Yet, contrary to what is often hoped, relying on companies to issue the debts that will be their counterpart is futile. In recent years, by pushing long-term interest rates ever lower, central banks have succeeded in stimulating household mortgage borrowing. The lengthening of loan maturities as well as the increasingly high level of property prices show however that this policy has reached its limits.

As long as households want to save more than private agents are willing to borrow, governments not only can, but should, continue to take on debt. If they use the resources they mobilize wisely, they will not go bankrupt. But this is a delicate balancing act!

Other titles from these three authors include:

  • Money, Finance, and the Real Economy (2015)
  • The Sovereign Debt Crisis: Placing a Curb on Growth (2012)

While Anton and Florence have also collaborated on:

  • The American Economy: A European View (2018)
  • Global Imbalances and the Collapse of Globalised Finance (2010)


"The low net debt of companies in virtually all developed economies may be surprising. Particularly since observers often worry about their excessive debt."