Even after the federal government was piling up massive deficits under Presidents Barack Obama and Donald Trump (and with the approval of both parties in Congress) during the 2010s, there was an emerging perspective among respected economists that challenged the traditional understanding of when the government should borrow and when it should pay down its debts.
Traditionally, during good times like the country enjoyed in the last decade—solid if not spectacular economic growth, relative peace, and historically low interest rates that made it easy for consumers and governments to borrow—policy makers would look to reduce spending and pay off debt. But those low interest rates created a new temptation. Maybe the government should just keep borrowing even when times are good?
