Why Rightwing MAGA-Hats Are Blind To The Exploding Public Debt

Now come the MAGA fanboys spewing economic illiteracy so insipid as to merit a cameo at the next Democratic national convention. According to the Breitbart Business Digest, there is nothing to sweat about on the Trumpified GOP’s Great Big Ugly Debt Bomb (GBUDB) because massive treasury borrowing doesn’t raise interest rates:

Debt and Rates: A Link That Isn’t There

The Penn Wharton Budget Model rests on a simple, elegant logic: when the government borrows more, it competes with the private sector for capital. That drives up interest rates, discourages business investment, and cancels out the growth you might get from tax relief.

The problem is, we’ve lived through the test case—and it didn’t happen. Since the 1990s, the U.S. debt-to-GDP ratio has soared from under 40 percent to more than 120 percent. Yet interest rates have mostly fallen. Even during periods of rapid borrowing, including after the 2017 tax cuts, bond yields remained historically low. There was no crowding out, no investment slump, and no spike in the cost of capital