Getting the GDP up certainly will help; currently the debt is 108% of GDP.
Getting the GDP up certainly will help; currently the debt is 108% of GDP.
That said, the current rates that debt is financed at is already artificially low. There’s very little room to refinance downward. More directly, the debt is so high that a return to historical norms for interest rates would increase the cost of annual debt servicing from the current levels to around $900 Billion a year. This is one of the many traps Obama (and the Reserve) have laid for whomever is the next President.
If the Fed doesn’t allow the near zero interest rates to increase substantially when the economy gets growing, inflation will shoot through the roof - and it is already understated now in certain core areas.