Such high and rising debt would have serious negative consequences for the budget and the nation:
When interest rates increased from their current levels to more typical ones, federal spending on interest payments would rise substantially. Because federal borrowing reduces total saving in the economy over time, the nation’s capital stock would ultimately be smaller than it would be if debt was smaller, and productivity and total wages would be lower. Lawmakers would have less flexibility to use tax and spending policies to respond to unexpected challenges. The likelihood of a fiscal crisis in the United States would increase. There would be a greater risk that investors would become unwilling to finance the government’s borrowing needs unless they were compensated with very high interest rates; if that happened, interest rates on federal debt would rise suddenly and sharply.