It’s presumably very _cheap_ debt, though? Ireland’s in a somewhat similar situation (don’t be fooled by the headline debt to GDP figure; Ireland’s GDP is distorted to the point that the government has had to make up its own adjusted metrics), though it’s currently running big budget surpluses, and from time to time someone will ask “why, instead of lowering taxes and investing in infrastructure, are we not using this surplus to pay down debt?” And the answer is that the average cost of the debt is 1.5% (the expensive stuff from the financial crisis has largely refinanced). It makes little sense to aggressively pay down debt at those sorts of rates.
A quick google search indicated debt interest is about 5% of the national budget.
This does seem low in comparison to the US, where ~17% of the national budget is spent servicing debt interest. For context, this is approximate 1.5X what we spend on national defense. [1]
Huh. Ireland’s is about 2.5% (3.1bn on 119bn budget next year). Slightly puzzled at what’s going on with the US debt; that does seem very expensive. Though it’s not _entirely_ comparing like for like, in that states have their own separate budgets in the US (local authorities in Ireland do too, but their own revenue raising capabilities are very limited and most of the money comes from central government).
Looks like the US’s cost of servicing works out to about 3.4%, which definitely seems rather high (though, probably still not high enough that you’d necessarily want to aggressively pay it down; 3.4% isn’t a _great_ return). Actually, I’d wonder how much of this is related to the debt ceiling stuff; I would assume that makes refinancing when debt is cheap more difficult.
