The Biden Economy

[Rajoo]

Originally Posted by donquixote99

And the other reasons are that:

1. Paying off debt would tend to drive down the interest payable on bonds. Holders of debt wouldn't like that.

2. Paying off debt would be done by raising taxes. Holders of debt would really hate that. Basically they like the system where instead of paying taxes, they loan the money to the government, and collect interest on it. Forever.

You have nailed it DQ.

The unexpected deficit surge, which comes amid signs of strong growth in the economy overall, is likely to shape a fierce debate on Capitol Hill about the nation’s fiscal policies as lawmakers face a potential government shutdown this fall and choices over trillions of dollars in expiring tax cuts. The Senate will return this week from August recess, and the House will be back the following week. Biden and House Speaker Kevin McCarthy (R-Calif.) approved a deal in June to raise the nation’s borrowing limit, but it did little to alter the long-term debt trajectory.

The higher deficit may undermine Biden’s attempts to take credit for reining in the budget ahead of the 2024 presidential election. And it could pose a challenge to Republican lawmakers, who — despite their calls for fiscal responsibility — are pushing to extend more than $3 trillion in tax cuts they approved in 2017.

The Republican House will happily shut down the government for some measly reduction in spending yet will happily continue tax cuts while trying to sabotage tax collections.

https://www.washingtonpost.com/busin...interest-rate/