Public Debt: The Infernal Spiral

When the Maastricht Treaty was signed in 1992, the member states of the European Union agreed to establish a culture of fiscal discipline within the zone. This led to the implementation of a debt-to-GDP threshold of 60%. This rule has been used as a benchmark by rating agencies, including Moody's, Fitch Ratings, and S&P Global Ratings, for assessing the sovereign credit rating of states.

Thirty-three ...