A Balance-Sheet Approach to Fiscal Policy by Kemal Dervis published by Project Syndicate (8/2015).
“Current fiscal-policy debates are based on flawed thinking about debt. It is time to stop focusing on nominal debt-to-GDP ratios, and instead promote a long-term balance-sheet-oriented approach to public spending.
WASHINGTON, DC – Everyone is talking about debt, citing huge nominal figures that strongly affect public-policy debates worldwide. But all debt is not created equal.
For starters, when it comes to public debt, there is a big difference between the gross and net figures. While Japan’s gross public debt, for example, is a massive 246% of GDP, the net figure, accounting for intra-government debts, is 127% of GDP…”
