Higher Interest Rates and the National Debt
Higher short- and long-term Treasury rates mean that the federal government's borrowing costs will also rise.
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Higher short- and long-term Treasury rates mean that the federal government's borrowing costs will also rise.
One of the largest drivers of that rising debt is federal spending on major healthcare programs, such as Medicare and Medicaid.
Interest rates on U.S. Treasury securities have a significant influence on federal borrowing costs.
https://www.pgpf.org/blog/2023/07/higher-interest-rates-could-cause-the-national-debt-to-skyrocket
When the US government reaches its debt ceiling, the Treasury can use a variety of accounting maneuvers, known as “extraordinary measures” to keep the federal government from defaulting on its debts.
https://www.pgpf.org/blog/2023/06/what-are-the-treasurys-extraordinary-measures-on-the-debt-ceiling
“America’s fiscal outlook is more dangerous and daunting than ever, threatening our economy and the next generation."
“Voters understand the urgency of our fiscal challenges, and that’s why they want lawmakers to take concrete steps to secure our future,” said Michael A. Peterson.
https://www.pgpf.org/press-release/2023/06/fci-press-release
Increasing the debt ceiling allows the Treasury to borrow funds to pay for government obligations that have already been incurred as the result of laws and budgets approved by the President and Congress.
When the debt limit is close to being breached, or when a suspension of the ceiling is nearing, lawmakers would have to act to avoid serious economic and budgetary consequences.
https://www.pgpf.org/blog/2023/06/how-the-lack-of-action-on-the-debt-ceiling-can-hurt-the-economy
"As we race past $32 trillion with no end in sight, it’s well past time to address the fundamental drivers of our debt," said Michael A. Peterson, CEO of the Peter G. Peterson Foundation.
Every month the U.S. Treasury releases data on the federal budget, including the current deficit. Here is the data for April 2023.
https://www.pgpf.org/the-current-federal-budget-deficit/budget-deficit-april-2023