A Note Regarding the Federal Debt
October 7, 2013
The U. S. Federal Debt, currently running $17
trillion, isn't, to my knowledge, an imminent threat. What's important is
the cost of servicing the federal debt. That depends upon the current interest
rate the U. S. government has to pay on government bonds Although federal
deficits have been running at record highs, interest rates have been running at
historical lows. The relative cost of servicing the national debt peaked in the
1990's, and is now running, I believe, a little over half that amount. Barring
another recession and another round of swollen safety net costs, the deficit
should begin to recede as a fraction of Gross Domestic Product.
I'm not saying the running huge deficits is a good thing... only that I don't think it's as pressing a problem as it was in the 1990's.