Why do governments care so much about reducing public debt if they are the sovereign issuer of their currency?

Question

Why do governments care so much about reducing public debt if they are the sovereign issuer of their currency?

In: Economics

Answer 1

All econ, which people forget, is about trying to model the behavior of people so we can get preferred results.

When you prioritize debt, you stagnate because you legitimately don’t understand how a mortgage works. Moreover, this typically comes at the disadvantage of the poor. When you disregard debt, as the sovereign issuer, people don’t invest in your country.

So if you have those two extremes, it makes sense that choosing a middle ground will yield some intermediate result. You can shift one way or the other depending on what you wish to emphasize.