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Expert Opinion

The U.S. Government Needs to Stop Subsidizing Debt

"To some extent, debt follows a cycle of optimism and pessimism rooted in human nature. But the government abets it."

By The Editors of Bloomberg | Updated on October 15, 2018
A pedestrian passes in front of American Flags displayed in front of The U.S. Capitol building before sunrise in Washington, D.C. Photographer: Andrew Harrer/Bloomberg

Of all the much-debated causes of the 2008 financial crisis, there’s one on which almost everyone agrees: U.S. homeowners took on debts that would have been affordable only in an improbably benign world. Ten years later, according to a recent report by Bloomberg News, many of the largest U.S. corporations are getting into a similar predicament.

It’s too early to say whether the rising indebtedness will lead to another financial disaster. But one thing is certain: There’s no good reason for the government to encourage it.

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