https://www.nationalreview.com/2022/...a-debt-crisis/
Why Interest Rates Could Drive a Debt Crisis
Good article here on rising debt and interest rates. But this article addresses a couple narratives often avoided:
The fact that America “owes the money to ourselves” due to domestic lending does not mean the debt is free. The people and businesses lending the federal government tens of trillions must be repaid, and those future repayments (and the interest costs) will have to paid out of significantly higher taxes, reduced federal benefits, higher inflation, or more borrowing until the markets stop lending.
No, Japan’s 200 percent of GDP debt does not prove that debt does not matter. Its past three decades of deficit spending have been accompanied by sluggish economic growth. Japan’s debt has not been inflationary because much of it has been funded by substantial domestic savings — such as corporate retained earnings equaling 89 percent of GDP. America’s entitlement-driven annual deficits are projected to far exceed — and prove more politically difficult to reverse than — Japan’s smaller annual deficits that financed flexible priorities such as stimulus and infrastructure.