America’s Debt, Inflation, and Rates Collide

America’s Debt, Inflation, and Rates Collide

The United States has entered a classic late-cycle fiscal squeeze: record federal debt, stickier-than-hoped inflation, and higher interest rates are now feeding on one another, pushing borrowing costs up for both Washington and households—and turning macroeconomics into everyday pocketbook pressure as campaigns head into the midterms. At a Glance Gross federal debt has surpassed $40 trillion, with interest costs rivaling the largest federal pro…