Does the National Debt Cause Inflation? What 150 Years of Data Show

Debt and market figures are the latest available on October 16, 2026. The historical tables come from the Jordà-Schularick-Taylor Macrohistory Database and the OMB Historical Tables; the code and outputs are public.

The federal government ran a $2.0 trillion deficit in fiscal 2026, $218 billion more than the year before.¹ Consumer prices rose 3.7% in the twelve months to September.² Many people connect the two: the government borrows, money gets printed, prices rise. Economists have argued about that link for decades. On debt levels the historical record gives a clear answer; on deficits it gives a conditional one.

The short answer

A high debt ratio has not been followed by higher inflation in rich countries; since 1870 the high-debt years were followed by slightly lower inflation than the low-debt ones. Very large deficits were sometimes followed by high inflation, between the world wars and in Italy and Portugal in the 1970s and 1980s, with no such cases since 1991. The 2021–22 inflation is the recent episode where fiscal transfers probably added to price rises, because they arrived when supply could not keep up.

Inflation can shrink the debt, mostly when it runs ahead of the interest lenders are paid, and the cost lands on holders of fixed-rate bonds. For a household the debt matters through future taxes, interest rates, and a small chance of a high-inflation regime. Each of those has a hedge that does not depend on a forecast.

What “the national debt” measures

The headline number, total public debt outstanding, was $40.39 trillion on October 15, 2026. About $7.85 trillion of it is owed by the Treasury to federal trust funds such as Social Security, which nets out inside the government. Economists use debt held by the public, $32.54 trillion, because that is what the Treasury owes to everyone else.³ The Federal Reserve holds $4.57 trillion of it, about 14%.⁴ Foreign investors held $9.33 trillion in August, about 29%.⁵

As a share of the economy, debt held by the public peaked at 106.1% of GDP in 1946, fell to 23.2% by 1974, and was 99.5% at the end of fiscal 2025.⁶ The Congressional Budget Office projects 100.6% for 2026 and 120.2% for 2036 under current law.⁷ Its long-term data release extends the same assumptions to 175% in 2056; CBO published that as a spreadsheet in place of its usual long-term report.⁸ These projections assume current law stays in place; they do not predict what Congress will do.

Two quantities get mixed up in this debate. The debt is a stock: everything borrowed and not yet repaid. The deficit is a flow: how much is added this year. CBO puts the fiscal 2026 deficit at 5.8% of GDP, of which 2.6% is the primary deficit, spending above revenue before interest.⁷ The two matter for inflation through different channels, and the data below treat them separately. What the debt costs in interest, and how fast higher yields reach the budget, is covered in Will Government Bonds Blow Up?

Three ways government borrowing can raise prices

Spending more than the economy can produce

A deficit means the government is adding more to spending than it takes out in taxes. If factories and workers are idle, that extra demand mostly raises output. If they are already busy, it raises prices. This channel runs through the deficit, the flow, and its size depends on how much slack the economy has and how hard the central bank leans against it. The IMF estimated that an extra 1% of GDP in public spending raised inflation by about 0.8 percentage point across 17 advanced economies from 1950 to 1985 and by about 0.5 point afterward, when central banks responded more forcefully.⁹

Doubts that future budgets will pay for the debt

The fiscal theory of the price level starts from a valuation condition. Government bonds are a claim on future primary surpluses, so the real value of the nominal debt must equal what investors expect those surpluses to be worth today:

Here $B_{t-1}$ is the nominal debt coming into the year, $P_t$ the price level, $s$ future real primary surpluses and $r$ the real discount rate. If investors come to believe that future surpluses will be smaller, and nothing else adjusts, the right side falls and the price level on the left has to rise. No money printing is required. John Cochrane’s 2023 book sets out the theory in full.¹⁰ Eric Leeper and Todd Walker argue that monetization is only one route to fiscal inflation, and also that these effects are hard to detect in time-series data.¹¹ In a model estimated on US data, Francesco Bianchi, Renato Faccini and Leonardo Melosi find that spending shocks the public does not expect to be paid for produce persistent inflation.¹²

This is a contested framework. Most central-bank models assume the opposite arrangement: the central bank anchors inflation, and Congress eventually adjusts taxes or spending. The US record has mostly fit that second description. Henning Bohn found, in data through 1995, that the US primary surplus rose as the debt ratio rose, which is the behavior that keeps debt from being inflationary in either view.¹³ Past behavior does not guarantee future behavior, which is why the theory gets attention at today’s debt levels.

A central bank that finances the government

The oldest channel is the direct one: the central bank buys government debt with newly created money, or holds rates down to keep the interest bill manageable. Economists call the second case fiscal dominance. Thomas Sargent and Neil Wallace showed in 1981 that if fiscal policy never adjusts, tight money today can mean higher inflation later.¹⁴ How that argument applies to rate hikes is covered in Do Higher Interest Rates Cause Inflation?

What 150 years of data show

The Jordà-Schularick-Taylor Macrohistory Database covers 18 advanced economies from 1870 to 2020, with public debt, government revenue and spending, and consumer prices for most country-years.¹⁵ For each country and year we took public debt as a share of GDP and the deficit as a share of GDP, then measured average annual inflation over the next five years. The table groups the results by debt level and by deficit size, leaving out the years of the two world wars.

The debt level does not sort countries by later inflation, and if anything the high-debt group had lower inflation. Among deficits only the largest stand out: when a government was running a deficit of 6% of GDP or more, the next five years averaged 4.6% inflation at the median, and a fifth of those windows ran above 10% a year. Most of the high-inflation cases come from the 1920s and 1930s (France, Belgium, Italy and Portugal) and from Italy, Portugal and Sweden in the 1970s and 1980s. Since 1991 the pattern disappears. The large deficits of that period, in the early-1990s recessions, in Japan, and after the 2008 crisis, were followed by low inflation. Most of them came in recessions, when economies had spare capacity, which may matter as much as the change in how central banks operate.

Three things limit these descriptive comparisons. First, the five-year windows overlap, so the 2,232 country-years hold far fewer independent observations. Second, causation also runs backward: inflation shrinks the debt ratio, so a country that has just had high inflation shows up as low-debt with inflation still running. That probably explains part of why low debt went with high inflation from 1973 to 1990. Third, the database has no debt figures for Germany from 1914 to 1926 or for France during and after either world war, so the worst fiscal inflations, including Germany’s 1923 hyperinflation, are missing from the debt rows.

A broader historical survey reaches the same conclusion. Michael Bordo and Mickey Levy find that deficits produced inflation mainly in wartime, when governments resorted to the inflation tax. In peacetime they find two cases where bond-financed deficits not backed by future taxes seem to have contributed greatly to inflation, France in the 1920s and the United States in the 1930s. They describe fiscal pressure on monetary policy as a key factor in the 1970s, and they note that the large fiscal and monetary response to the 2008 crisis did not raise inflation.¹⁶

Japan’s gross public debt rose from 94% of GDP in 1995 to 254% in 2020 in the JST data, while its consumer prices rose 0.2% a year on average and fell in 14 of those 26 years. The United States had one of its lowest debt ratios in 1974, and the consumer price index rose 9.0% a year on average from 1973 to 1981, with the debt ratio low throughout.²Bordo and Levy tie that episode partly to fiscal pressure on the Fed. Between fiscal 2008 and 2019, US debt held by the public more than doubled as a share of GDP, from 35% to 79%, and the GDP price index rose 1.6% a year.

The pandemic test

The 2021–22 inflation is the one recent episode that fits the fear. Economists at the San Francisco Fed compared the United States with other rich countries and estimated that US income-support programs may have raised inflation by about 3 percentage points by the end of 2021, an estimate they describe as uncertain.¹⁷ Ben Bernanke and Olivier Blanchard traced most of the surge to price shocks: commodity prices driven up by strong demand, and shortages in sectors that could not expand when spending shifted toward them. They found that the overheated labor market contributed less, though its effects lasted longer.¹⁸

Robert Barro and Francesco Bianchi asked the fiscal-theory version of the question across OECD countries for 2020 to 2023. Inflation rose more where the spending surge was larger relative to the existing debt and its duration. Holding the stimulus fixed, a country with more debt, or debt of longer maturity, had less inflation, because the loss in real value was spread over a larger and longer stock of bonds. In the version of their paper revised in July 2025, they estimate that about 80% of the effective financing of the extra spending came from unexpected inflation reducing the real value of public debt, and only about 20% from conventional public finance.¹⁹

The estimated model of Bianchi, Faccini and Melosi points the same way: in it, unfunded fiscal shocks after the pandemic caused a persistent rise in inflation, and the model anticipated the inflationary effect of the American Rescue Plan out of sample.¹² So the episode fits both the demand channel and the fiscal-theory channel: a large, fast transfer program arriving when supply chains were broken, paid for in large part by eroding the real value of existing debt. Set beside the low inflation that followed the large deficits of 2009 to 2015, it shows that what a deficit does to prices depends on how much spare capacity the economy has. Current inflation is a different case. September’s 3.7% headline rate came with core inflation, which excludes food and energy, at 2.6%, and energy prices up 20.4% over the year.² No study we found attributes 2026 inflation to the level of the debt.

Can inflation shrink the debt?

George Hall and Thomas Sargent split the fall in US debt after the Second World War into its sources. On their measure, debt fell from 66.2% of GDP in 1945 to 11.3% in 1974. Of that 54.9-point drop, 21.6 points came from real economic growth, 20.8 from primary surpluses, and 12.5, about 23%, from negative real returns on the debt: inflation above the interest paid.²⁰

We repeated the split with OMB’s par-value figures for debt held by the public, extended through fiscal 2025. Each year’s change in the debt ratio divides exactly into the primary deficit, interest paid, the erosion from rising prices, real growth, and a small residual for cash balances and other financing. The inflation column is what rising prices took off the ratio; the real-interest column nets out the interest the Treasury paid to compensate lenders.

From 1946 to 1974, inflation above the interest paid accounted for 21% of the decline on this measure, close to Hall and Sargent’s 23%. Real growth contributed 42%, against their 39%, and primary surpluses 26%, against their 38%; the gap reflects the different debt measures and our stock-flow residual. Reinhart and Sbrancia’s larger estimate of 3% to 4% of GDP a year, quoted in the bonds guide, counts only the years when real interest rates were negative and uses different debt and interest measures. Averaged over every year from 1946 to 1974, the real-interest effect on OMB’s figures is about 0.6 point a year. Financial repression helped: interest-rate caps and rules that made banks hold government bonds kept the interest column low while prices rose, which the bonds guide covers in Can governments inflate the debt away?

The recent inflation did the same thing on a smaller scale. Over fiscal 2021 to 2023, rising prices took 13.4 points off the debt ratio, and after the interest paid the net real-interest effect was 7.6 points. Primary deficits added 17.8 points over the same three years, so the ratio still fell only from 98.5% to 95.8%. By fiscal 2024 and 2025 the interest column was larger than the inflation column again, meaning the debt was costing more than inflation was eroding.

Jens Hilscher, Alon Raviv and Ricardo Reis estimated how much plausible inflation could reduce the US debt burden and concluded that inflation alone is unlikely to lower it significantly, because much of the debt is short-term and the inflation shocks investors consider plausible are small and short-lived.²¹ The IMF’s cross-country estimate is that a 1-point inflation surprise cuts public debt by about 0.6 point of GDP in countries with debt above 50% of GDP.⁹ That is an empirical, medium-term average. The mechanical first-year arithmetic for debt near 100% of GDP gives about 0.9 point, before any response from interest rates or indexed benefits.

Inflation that investors expect is priced into every new Treasury the government sells. The US refinances about a third of its marketable debt within a year,²² and 7% of it is TIPS, whose principal rises with the CPI.²³ The simulator below starts from CBO’s 2026 position and lets you add a burst of inflation, choose how long it lasts, and set how quickly investors catch on.

With the defaults, inflation 3 points above plan for three years, priced into new debt from the second year, cuts the debt ratio by 5.8 points at the peak. After 30 years 2.6 points of that remain, less than half. In the model, investors who catch on assume the higher inflation will last and lock it into the fixed coupons of new bonds. When the burst ends on schedule those bonds keep paying high coupons, and that is where most of the cut goes. Investors who foresaw when the burst would end would charge less, and more of the cut would stick. If investors are fooled for the whole burst, the cut is 8.2 points and permanent, and none of it comes back to bondholders as higher interest. The runs are hypothetical and depend on the assumptions listed in the tool. The no-surprise path reaches 123% of GDP in 2036, a little above CBO’s 120%, because the model simplifies CBO’s paths for the deficit, growth and interest rates.

When US debt could become inflationary

The historical cases where debt fed inflation share a feature: either the central bank financed the government, or investors stopped believing future budgets would cover the debt. That makes the relevant risk institutional. The questions are whether the Federal Reserve keeps setting rates for inflation rather than for the Treasury’s interest bill, and whether Congress eventually closes the primary deficit.

Fed independence was tested in court in 2026. On June 29 the Supreme Court, by 5 to 4, declined the administration’s request to let it remove Governor Lisa Cook while her case proceeds. The order is interim; the Court has not ruled on whether the removal is lawful.²⁴ Moody’s cut the US from Aaa to Aa1 in May 2025.²⁵

Markets give a running read on this risk. On October 16 the ten-year Treasury yielded 5.09% and the ten-year TIPS 2.74%, which puts the ten-year breakeven inflation rate near 2.35%, against 2.25% on January 2.²⁶ Real yields rose about 0.8 point over the same months while the breakeven moved a tenth of a point. A breakeven also carries risk and liquidity premiums, so it is an imperfect gauge, but investors who feared a debt-driven inflation would be expected to push it up. The list of market signals worth watching, from auctions to the dollar, is in Will Government Bonds Blow Up?

Other reasons to care about the debt

Interest crowds out other spending. CBO projects net interest rising from 3.3% of GDP in 2026 to 4.6% in 2036.⁷ Jason Furman and Lawrence Summers argue that real interest as a share of GDP is the better measure of the burden than the debt ratio, and proposed keeping it from rising above 2% of GDP.²⁷

More debt tends to mean higher interest rates. Thomas Laubach estimated that each point of projected debt-to-GDP adds 3 to 4 basis points to long-term forward rates, and 25 basis points for each point of projected deficit.²⁸ A CBO working paper by Edward Gamber and John Seliski put the debt effect at 2 to 3 basis points.²⁹ Applied to CBO’s projected rise of about 20 points over the next decade, those estimates imply long rates roughly 0.4 to 0.8 point higher than otherwise, a back-of-the-envelope figure that assumes the historical relationships hold. How deficits reach mortgage and bond yields is in How Much of a Ten-Year Treasury Yield Is Risk Compensation?

Less room in the next recession. A government that enters a downturn with a primary deficit of 2% to 3% of GDP starts from a weaker position than one near balance, even if markets keep lending.

The special demand for Treasuries has limits. Investors accept lower yields on Treasuries because they serve as collateral and safe assets worldwide. Jason Choi, Duong Dang, Rishabh Kirpalani and Diego Perez estimate that without this special status the sustainable US debt level would be up to 30% lower, mostly because of the lost convenience yield.³⁰ Zhengyang Jiang, Hanno Lustig, Stijn Van Nieuwerburgh and Mindy Xiaolan find that Treasuries are priced above the present value of projected surpluses, which the authors read as a sign that Treasuries may be overpriced.³¹

No debt ratio marks a cliff. Carmen Reinhart and Kenneth Rogoff reported in 2010 that growth fell sharply when debt exceeded 90% of GDP.³² Thomas Herndon, Michael Ash and Robert Pollin found coding errors and data exclusions in that work; corrected, average growth above 90% was 2.2%, against the −0.1% originally reported.³³ An IMF study by Andrea Pescatori, Damiano Sandri and John Simon found no threshold above which medium-term growth is dramatically compromised, and found that countries with high but falling debt grew as fast as those with lower debt.³⁴ Paolo Mauro and Jing Zhou found that an interest rate below the growth rate has been common and that the gap did not rise ahead of sovereign defaults, so a favorable r minus g offers less comfort than it appears to.³⁵

What the debt changes in a household plan

A fiscal gap of this size closes through some mix of higher taxes, lower spending, faster growth, and inflation. Each lands on households differently, and each has a hedge that works without predicting which one Congress picks.

• Inflation risk: index the spending you cannot cut. TIPS and I bonds tie principal to the CPI. The ten-year TIPS yielded 2.74% above inflation on October 16. A ladder matched to retirement spending is in How to Build a TIPS Ladder; how the options compare after tax is in The Best Inflation Hedges Are Boring.
• Tax risk: hold money in more than one tax treatment. A mix of traditional, Roth, and taxable accounts lets you choose which pool to draw from once future rates are known. The trade-off is in Roth vs. Traditional.
• Rate risk: match bond maturity to when you need the money. A bond you hold to the date of a known expense cannot be hurt in dollar terms by a rise in yields along the way; a TIPS held to maturity does the same in real terms. See Asset-Liability Matching.
• Forecast risk: keep the allocation you chose. The deficit projections are public, and bond and stock prices are set by investors who have read them. Selling Treasuries or buying gold because of a debt headline is a bet that you know something the market does not, made against the base rates in Why Macroeconomic Forecasts Are Not an Investment Strategy.

Common claims against the evidence

Key Takeaways

• Debt levels have not predicted inflation. In 18 rich countries outside the world wars, median inflation over the next five years was 2.5% a year with debt below 30% of GDP and 1.5% with debt at 90% or more.
• Large deficits have, under specific conditions. Peacetime deficits of 6% of GDP or more were followed by 4.6% median inflation, mostly between the wars and in the 1970s and 1980s. Since 1991, with independent central banks and mostly recession-driven deficits, the pattern has disappeared.
• Pandemic transfers probably added to inflation. One cross-country study estimates US transfers may have added about 3 points by the end of 2021, with wide uncertainty. Watch for spending surges into a tight economy and for pressure on the Fed.
• Inflation is a weak debt-reduction tool. Inflation above the interest paid accounted for about a fifth of the 1946–74 decline, and in fiscal 2021–23 it trimmed the ratio by 7.6 points net of interest while deficits added 17.8.
• Hedge the channels. TIPS for real spending, several tax treatments for unknown future tax rates, and bonds matched to your horizon.

Frequently Asked Questions

Does the national debt cause inflation?

Not by its size alone. Across 18 advanced economies since 1870, high debt ratios were not followed by higher inflation. Inflation has followed very large deficits, mainly in wartime, between the wars, and in some countries in the 1970s and 1980s, and it can follow if investors stop believing future budgets will pay for the debt.

Did stimulus cause the 2021–22 inflation?

It probably contributed. A San Francisco Fed study estimates US income support may have added about 3 percentage points by the end of 2021, with considerable uncertainty. Bernanke and Blanchard attribute most of the surge to commodity price shocks and sector shortages, which strong demand helped cause.

Why doesn’t Japan have high inflation with so much debt?

Japan’s gross debt rose from 94% to 254% of GDP between 1995 and 2020 while its consumer prices were roughly flat, falling in 14 of those years. High debt has not brought inflation in Japan; it has brought rising bond yields in 2026, which the bonds guide covers.

Can the US inflate its debt away?

Only partly. Without rate caps, inflation erodes debt mainly when it was not priced in when the bonds were sold, and about a third of US marketable debt reprices within a year. After World War II, inflation above the interest paid accounted for about a fifth of the fall in the debt ratio, helped by rate caps and rules that made banks hold government bonds.

Is the Fed printing money when it holds Treasuries?

The Fed pays for Treasuries with bank reserves, which now earn interest. Its holdings were $4.57 trillion in October 2026, about 14% of debt held by the public. The inflation risk comes when the Fed buys debt or holds down rates to help the Treasury rather than to hit its inflation target.

Is there a debt level that triggers a crisis?

No reliable one has been found. The 90% threshold reported in 2010 did not survive correction, and IMF researchers found no threshold in a larger sample. Debt trends, interest costs, and whether debt is in a country’s own currency matter more than any single ratio.

Should I change my portfolio because of the national debt?

Probably not your stock-bond mix. Use TIPS or I bonds for spending that must keep up with inflation, spread savings across tax treatments, and match bond maturities to when you need the money. Those steps cover the debt’s main channels without relying on a forecast.

Related Guides

• Will Government Bonds Blow Up?: the debt arithmetic, how yields reach a budget, France and Japan, and what a debt scare means for your bond fund.
• Do Higher Interest Rates Cause Inflation?: the rate-hike evidence and where fiscal dominance fits.
• How Much of a Ten-Year Treasury Yield Is Risk Compensation?: deficits, Treasury supply and the term premium.
• Do T-Bills Beat Inflation?: what financial repression did to cash savers in the 1940s.
• The Best Inflation Hedges Are Boring: TIPS, I bonds and the after-tax arithmetic.
• The Four Deep Risks of Investing: inflation, deflation, confiscation and devastation.

Sources

1. Congressional Budget Office, Monthly Budget Review: September 2026 (October 8, 2026): deficit of $1,993 billion in fiscal 2026 against $1,775 billion in 2025. cbo.gov
2. US Bureau of Labor Statistics, Consumer Price Index, September 2026 (released October 14, 2026); all items 3.7%, all items less food and energy 2.6%, energy 20.4%, twelve months not seasonally adjusted; and CPI-U annual averages for 1972 (41.8) and 1981 (90.9), series CUUR0000SA0. bls.gov
3. US Treasury, Fiscal Data, Debt to the Penny, October 15, 2026: total public debt outstanding $40,388 billion; debt held by the public $32,538 billion; intragovernmental holdings $7,850 billion. fiscaldata.treasury.gov
4. Board of Governors of the Federal Reserve System, H.4.1 Factors Affecting Reserve Balances (October 15, 2026): US Treasury securities held, $4,570.6 billion on October 14. federalreserve.gov
5. US Treasury, Treasury International Capital, Table 5, Major Foreign Holders of Treasury Securities: $9,331.7 billion at the end of August 2026. The share uses Debt to the Penny for the denominator; TIC values holdings differently, so it is approximate. ticdata.treasury.gov
6. Office of Management and Budget, Historical Tables, FY2027 Budget: Table 1.1 (surplus or deficit), 3.1 (net interest), 7.1 (federal debt at the end of year) and 10.1 (GDP and the GDP chained price index). whitehouse.gov
7. Congressional Budget Office, The Budget and Economic Outlook: 2026 to 2036 (February 11, 2026): debt held by the public 100.6% of GDP in 2026 and 120.2% in 2036; deficit 5.8% and primary deficit 2.6% of GDP in 2026; net interest 3.3% and 4.6% of GDP; average interest rate on debt 3.4% in 2026. cbo.gov
8. Congressional Budget Office, The Long-Term Budget Outlook Data: 2026 to 2056 (February 25, 2026), sheets 1, 12 and 15: debt 175.1% of GDP in 2056; nominal GDP growth averaging 4.0% for 2026–36; average interest rate on federal debt 4.0% to 4.2% from 2036 to 2056. cbo.gov
9. International Monetary Fund, Fiscal Monitor, April 2023, “On the Path to Policy Normalization,” Chapter 2, “Inflation and Disinflation: What Role for Fiscal Policy?” Underlying paper: Daniel Garcia-Macia, “The Effects of Inflation on Public Finances,” IMF Working Paper 2023/093. imf.org
10. John H. Cochrane, The Fiscal Theory of the Price Level(Princeton University Press, 2023). press.princeton.edu
11. Eric M. Leeper and Todd B. Walker, “Perceptions and Misperceptions of Fiscal Inflation,” NBER Working Paper 17903 (2012). nber.org
12. Francesco Bianchi, Renato Faccini and Leonardo Melosi, “A Fiscal Theory of Persistent Inflation,” Quarterly Journal of Economics 138(4): 2127–2179 (2023). doi.org
13. Henning Bohn, “The Behavior of U.S. Public Debt and Deficits,” Quarterly Journal of Economics 113(3): 949–963 (1998). doi.org
14. Thomas J. Sargent and Neil Wallace, “Some Unpleasant Monetarist Arithmetic,” Federal Reserve Bank of Minneapolis Quarterly Review 5(3) (1981). minneapolisfed.org
15. Òscar Jordà, Moritz Schularick and Alan M. Taylor, Macrohistory Database, release 6 (variables debtgdp, cpi, revenue, expenditure, gdp). Summitward calculation; the database is not redistributed. macrohistory.net; code and output at summitward-research
16. Michael D. Bordo and Mickey D. Levy, “Do Enlarged Fiscal Deficits Cause Inflation: The Historical Record,” NBER Working Paper 28195 (2020). nber.org
17. Òscar Jordà, Celeste Liu, Fernanda Nechio and Fabián Rivera-Reyes, “Why Is U.S. Inflation Higher than in Other Countries?” FRBSF Economic Letter 2022-07 (March 28, 2022). frbsf.org
18. Ben S. Bernanke and Olivier J. Blanchard, “What Caused the U.S. Pandemic-Era Inflation?” American Economic Journal: Macroeconomics 17(3) (2025); NBER Working Paper 31417. nber.org
19. Robert J. Barro and Francesco Bianchi, “Fiscal Influences on Inflation in OECD Countries, 2020-2023,” NBER Working Paper 31838 (2023, revised July 2025). Earlier versions cover 2020-2022 and report different shares. nber.org
20. George J. Hall and Thomas J. Sargent, “Interest Rate Risk and Other Determinants of Post-WWII US Government Debt/GDP Dynamics,” American Economic Journal: Macroeconomics 3(3): 192–214 (2011); NBER Working Paper 15702. nber.org
21. Jens Hilscher, Alon Raviv and Ricardo Reis, “Inflating Away the Public Debt? An Empirical Assessment,” Review of Financial Studies 35(3): 1553–1595 (2022). researchonline.lse.ac.uk
22. US Department of the Treasury, Presentation to the Treasury Borrowing Advisory Committee, Q3 2026: weighted average maturity of 70 months at July 31, 2026, with about a third of marketable debt maturing within a year. home.treasury.gov
23. US Treasury, Monthly Statement of the Public Debt, September 30, 2026: TIPS $2,173 billion of $31,835 billion total marketable debt. fiscaldata.treasury.gov
24. SCOTUSblog, “Court prevents Trump from firing Fed governor” (June 29, 2026), on Trump v. Cook, No. 25A312. scotusblog.com
25. Moody’s Ratings, United States of America rating action, May 16, 2025: long-term issuer rating to Aa1 from Aaa. moodys.com
26. US Department of the Treasury, Daily Treasury Par Yield Curve Rates and Daily Treasury Par Real Yield Curve Rates, October 16, 2026. The breakeven is the difference between the two ten-year yields. home.treasury.gov
27. Jason Furman and Lawrence Summers, “A Reconsideration of Fiscal Policy in the Era of Low Interest Rates,” discussion draft (November 30, 2020). brookings.edu
28. Thomas Laubach, “New Evidence on the Interest Rate Effects of Budget Deficits and Debt,” Journal of the European Economic Association 7(4): 858–885 (2009). federalreserve.gov
29. Edward Gamber and John Seliski, “The Effect of Government Debt on Interest Rates,” CBO Working Paper 2019-01 (March 2019). cbo.gov
30. Jason Choi, Duong Dang, Rishabh Kirpalani and Diego J. Perez, “Exorbitant Privilege and the Sustainability of US Public Debt,” NBER Working Paper 32129 (2024); AEA Papers and Proceedings 114: 143–147. nber.org
31. Zhengyang Jiang, Hanno Lustig, Stijn Van Nieuwerburgh and Mindy Z. Xiaolan, “The U.S. Public Debt Valuation Puzzle,” Econometrica 92(4): 1309–1347 (2024). doi.org
32. Carmen M. Reinhart and Kenneth S. Rogoff, “Growth in a Time of Debt,” American Economic Review 100(2): 573–578 (2010). nber.org
33. Thomas Herndon, Michael Ash and Robert Pollin, “Does High Public Debt Consistently Stifle Economic Growth? A Critique of Reinhart and Rogoff,” Cambridge Journal of Economics 38(2): 257–279 (2014). peri.umass.edu
34. Andrea Pescatori, Damiano Sandri and John Simon, “Debt and Growth: Is There a Magic Threshold?” IMF Working Paper 14/34 (2014). ideas.repec.org
35. Paolo Mauro and Jing Zhou, “r minus g negative: Can We Sleep More Soundly?” IMF Working Paper 20/52 (2020). ideas.repec.org

Author disclosure

Educational content, not investment or tax advice. The historical tables are descriptive and do not establish causes. The simulator is a simplified model under stated assumptions, not a forecast of the federal budget. Market levels change daily.