Читать книгу Stakeholder Capitalism - Klaus Schwab - Страница 21

Consider first rising debt. Global debt—including public, corporate, and household debt—by mid-2020 stood at some $258 trillion globally, according to the Institute of International Finance,¹⁷ or more than three times global GDP. That number is hard to grasp, because it is so big and because it includes all sorts of debt, going from public debt sold through government bonds to mortgages from private consumers.

But it has been rising fast in recent years, and that certainly is “alarming,” as Geoffrey Okamoto of the IMF said in October 2020. Not since World War II were debt levels in advanced economies so high, the Wall Street Journal calculated,¹⁸ and unlike in the post-war period, these countries “no longer benefit from rapid economic growth” as a means to decrease their burden in the future.

The COVID pandemic, of course, brought an exceptional acceleration of the debt load in countries around the world, and especially for governments. According to the IMF, by mid-2021, in the span of a mere 18 months, “median debt is expected to be up by 17 percent in advanced economies, 12 percent in emerging economies, and 8 percent in low-income countries”¹⁹ compared to pre-pandemic levels.

But even without the pandemic, debt had been creeping up in the past three decades. As one example: in advanced economies, public debt rose from about 55 percent in 1991, to over 70 percent in 2001, and more than 100 percent in 2011. It is estimated to reach more than 120 percent in 2021.²⁰

Faced with slowing global growth over the past decades, especially in advanced economies, governments, companies, and households nevertheless increased their debt. Could that have ever been a good idea? Theoretically, yes. When used to invest in productive assets, debt can be a lever of future economic growth and prosperity. But all debt does of course need to be repaid at some point (unless it evaporates because of inflation, but that has been less than 2 percent on average in advanced economies in the past 20 years²¹). The only alternative is to default, but that is akin to playing Russian roulette.

So what kind of debt has been made in recent decades? The debt of governments is often a mix of high-quality and low-quality debt. High-quality debt includes that used for building modern infrastructure or investments in education, for example. High-quality debt is typically paid back over time—and can likely even provide a return on the investment. Such projects should be encouraged. By contrast, low-quality debt, such as deficit spending to boost consumption, generates no returns, even over time. This type of debt should be avoided.

Overall, it is safe to say low-quality debt is on the rise. In part, this is because low interest rates in the West incentivize lending, which discourages borrowers from being careful with their spending. For governments, deficit spending has become the norm in recent decades, rather than the exception. The COVID crisis that erupted in the early months of 2020 hasn't made that picture any rosier. Many governments have effectively used “helicopter money” to sustain the economy: they printed money, creating an even higher debt with their central banks, and handed it to citizens and businesses in the form of one-off subsidies and consumption checks so they could get through the crisis unscathed. In the short term, this approach was necessary to prevent an even worse economic collapse. But in the long run, this debt too will need to be repaid. Overall, it adds to the large amounts of debt in recent years that wasn't used to spur long-term economic growth or to make the switch toward a more sustainable economic system. This debt will thus remain a millstone, hanging around many governments’ necks.

One silver lining comes from emerging and developing markets. Before the COVID crisis, they had relatively lower public debt levels of around 50–55 percent,²² with much of it invested in infrastructure (though during the COVID crisis, the debt level increased by about 10 percent). Some of these countries can be considered to have a demographic dividend, meaning a population with an average age in the low twenties, that is, heavily skewed toward younger generations. This type of population pyramid could make repaying debt more feasible if the coming surge in their working-age population is complemented by an equally high surge in available jobs. (The latter, however, has proven problematic in some Arab and African economies. Faced with a job shortage, a demographic dividend can rather turn into a ticking time bomb.^{23, 24})

How some ageing Western countries are supposed to repay their debts in a slowing economy, though, is highly questionable. The economies with the highest government debt load have historically been Japan and Italy. In addition to their debt, they have some of the world's most rapidly shrinking and ageing populations. While private savings of Japanese households can alleviate many of the most acute problems this trend could cause, the country's debt will sooner or later come back to haunt it, as its population shrinks from 127 million to fewer than 100 million over the next three decades, and its ratio of workers to retirees falls even further. It could easily increase the debt burden per head by another quarter or third.²⁵

Other European countries such as France, Spain, Belgium, and Portugal, all of which have gross public debt of over 110 percent of GDP²⁶ (and often much higher than that), could one day find that they are facing a similar fate. In a significant development, the United States joined the 100 percent club in the early 2010s, with its debt rapidly rising further in recent years, to over 130 percent in 2020.²⁷ The US situation raises a peculiar uncertainty because US government bonds are among the most traded in the world, and the US dollar is the de facto world reserve currency. A US government default is unlikely, given that its Federal Reserve has its hands on the printing press, but if it does happen, the global economic system as we know it might collapse.

It is in the combination of high debt and low growth that things really get problematic, from a financial point of view. In an environment where growth of 3 percent and more can be expected, government debt can quickly evaporate: the relative importance of past debt would decline in comparison to a growing GDP. Even in the recent past, countries like Germany and the Netherlands managed to considerably lower their debt burden on the back of favorable economic growth. But if low growth does remain the new normal, which seems likely, there is no easy mechanism for countries to repay their historical debt. Looking away certainly will not solve this problem.