This paper discusses the principles that justify activism of governments in the management of public debt. It starts from a review of the economics literature, which has produced, especially in recent years, a number of important propositions on the desirability of government interventionism, either for the purpose of filling information gaps or to help solve dynamic inconsistency problems. It then considers a number of practical arguments for government activism, stemming from the development of capital markets, and the need to keep up with them. The paper argues that government activism in debt management is much less warranted than the current economic literature or market practices might lead us to believe. The fundamental reason is that governments are not a private actor in the market, and so their optimization problem is radically different from that of other market participants. Copyright 1997 by Oxford University Press.