Governments are making a dangerous bet on the AI boom

Long-term bond yields in the US, France, Japan, and Britain have climbed to their highest levels since the 2007-09 financial crisis, signaling that the era of ultra-low interest rates is over. The Economist argues that governments are betting on an AI-driven productivity boom to justify rising debt burdens, a gamble that could backfire if the technology fails to deliver. The piece warns that markets are already pricing in higher yields, and that fiscal policies may be too reliant on an uncertain AI payoff.