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Kenneth Rogoff

US debt ceiling debate is really about power

The idea of both sides that debt is always free as long as it is used the ‘right’ way is stupefyingly naive.

Kenneth RogoffColumnist

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The tentative deal that was just struck to raise the United States debt ceiling won’t make the problem go away. Partisan standoffs over the federal debt limit have become a predictable feature of American political life. And while some blame an ill-conceived rule, that argument misses the point.

The real source of the problem is that politicians today have little incentive to compromise. In an environment of gerrymandered electoral districts and ideologically siloed traditional and social media (amplified by bots, algorithms and economic incentives), the instability will only worsen in the foreseeable future.

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Kenneth Rogoff is a former chief economist of the International Monetary Fund and professor of economics and public policy at Harvard University.

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    Original URL: https://www.afr.com/world/north-america/us-debt-ceiling-debate-is-really-about-power-20230528-p5dbul