Higher Treasury Yields Would Add Trillions to the Debt
MAY 6, 2025
The 10-year Treasury yield today is approaching 4.4 percent, over 50 basis points above the intra-day low a month ago on April 7, more than twice as high as early 2022 and 30 basis points more than economic projections. If the 10-year were to hover around 4.4 percent permanently and yields on other Treasury securities were to increase equally, it would add an extra $1.8 trillion to the debt above projections over the next decade, which is enough to counter the likely revenue gains from tariffs if they were to go into effect after the 90-day pause.
High and rising interest rates should serve as an important warning against efforts to add more to the already massive national debt – including through a $5.8 trillion reconciliation package.
Committee for a Responsible Federal Budget
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This has been the story for years now. The interest on the debt adds to the budget and it is growing beyond a lot of the government programs themselves. It doesn’t faze the Congress so I have to assume they don’t know what to do except continue to play the game. One day it will stop.
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