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Rising interest rates will shackle the government – unless Congress acts
- Victerius 4y agohttps://archive.ph/j5QEq https://archive.ph/j5QEq
- Victerius 4y ago> As Riedl notes, the debt is expected to skyrocket by an expected $112 trillion in the next 30 years, which includes interest costs. That amount largely comes from the unfunded promises the government has made to retirees and Americans receiving disability benefits via Social Security and Medicare. If Congress doesn’t start to reform those programs now, more and more debt will pile on. With the onset of inflation and higher interest rates, that means the government will be spending more to pay off bondholders than it does for virtually any other program. That is not politically sustainable. > Fixing our spending addiction will not be easy. Taxes will have to rise, and unnecessary spending will have to be cut. It makes sense for the bulk of those changes to fall on those who have benefited most from our globalized information economy. The alternative is to let tax hikes and benefit cuts fall largely on the middle class, which would mean ordinary Americans paying off the wealthy investors, banks and foreign governments that hold our debt. If that happens, we’ll see a populist whirlwind that would make the past decade look like a picnic. > Rising interest rates mean the federal government’s spending spree is over. How Congress responds will determine whether we remain the world’s strongest economy or sink into debt-financed shackles.