How to enable higher government spending without increasing the tax burden?

M any OECD countries currently face a contradiction between: A significant need for more public spending of various types; The need to ensure public debt sustainability and therefore to curb fiscal deficits, especially in a situation of rising interest rates. How to resolve this contradiction? There are two possibilities: Central banks do not react to inflation and do not raise interest rates despite it. This is Japan’s strategy. The risk is then that persistently highly negative real interest rates will lead to continuous asset price bubbles and to a sharp rise in wealth inequality; Potential GDP increases thanks to a rise in the employment rate or higher productivity gains. This would require either an improvement in skills that increases the employment rate and productivity, or targeted investments (digital economy, reindustrialisation) that increase productivity.