Local governments are experiencing a more severe challenge due to their debts. ANBOUND think tank scholars note that the swelling of local government debts is inseparable from the political ambition of local officials as well as from the current mechanism that local governments are ruling local resources. Therefore, in order to bail local governments out from the vicious cycle of debt issues, the key is to curb the political ambitions of those local officials and to properly handle the relationship between government and market.