Although fiscal responsibility is the right goal for any government, it cannot be properly measured through deficits and debt targets alone. Those who demand budget cuts in the face of higher debt levels overlook the importance of public spending that strengthens the economy’s productive capacity over time.
LONDON—Whether a hospital can hire nurses, a school can repair its roof, or a country can build a clean-energy grid often depends on factors that rarely make the news. For many governments, rules limiting deficits, debt, or spending ultimately determine whether they can invest in the future.