The Fiscal Times. National Debt Could Skyrocket As Interest Rates Rise

The interest rates on federal debt began climbing last month, jumping from 1.66 percent on a 10-year U.S. Treasury note at the start of May to a stunning 2.2 percent on Tuesday.

Every additional dollar devoted to servicing the debt gets subtracted from another government program—or adds to the yearly budget deficit.

The steadily rising interest rates reflect the difficulty of fully escaping the affects of the 2008 financial crisis. As the economy recovers and the Federal Reserve plans to pull back from its bond purchasing programs designed to stimulate the economy, the interest rate on federal debt starts to rise steadily.

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