When the rate on the debt rises above growth, the debt feeds on itself
Source. Treasury Fiscal Data, Average Interest Rates on U.S. Treasury Securities, total interest-bearing debt, monthly; OMB, Historical Tables, FY2027 Budget (April 2026), Table 1.2 (GDP, fiscal years). Also: OMB, Table 1.2. Fiscal years 2002–2025.
Method and data
Method. r is the mean of the twelve monthly average rates on total interest-bearing debt, October to September; g is the growth of nominal GDP over the fiscal year (OMB Table 1.2). 2022: r 1.72% − g 10.94% = −9.23 points; 2025: 3.31% − 4.75% = −1.44. r was below g in 17 of the 24 years. The FY2021 mean was 1.66%; the monthly low was 1.556% (January 2022).
| Fiscal year | r, average rate (%) | g, nominal GDP growth (%) | r − g (points) |
|---|---|---|---|
| 2002 | 5.60 | 2.88 | 2.72 |
| 2003 | 4.92 | 4.15 | 0.77 |
| 2004 | 4.53 | 6.65 | −2.12 |
| 2005 | 4.60 | 6.75 | −2.14 |
| 2006 | 4.89 | 6.21 | −1.31 |
| 2007 | 5.04 | 4.90 | 0.14 |
| 2008 | 4.60 | 3.43 | 1.17 |
| 2009 | 3.64 | −2.23 | 5.87 |
| 2010 | 3.22 | 2.88 | 0.34 |
| 2011 | 2.98 | 3.91 | −0.93 |
| 2012 | 2.73 | 4.16 | −1.43 |
| 2013 | 2.48 | 3.59 | −1.11 |
| 2014 | 2.41 | 4.44 | −2.02 |
| 2015 | 2.36 | 4.22 | −1.86 |
| 2016 | 2.30 | 2.63 | −0.33 |
| 2017 | 2.26 | 3.94 | −1.68 |
| 2018 | 2.38 | 5.48 | −3.10 |
| 2019 | 2.56 | 4.16 | −1.60 |
| 2020 | 2.15 | 0.24 | 1.91 |
| 2021 | 1.66 | 8.00 | −6.34 |
| 2022 | 1.72 | 10.94 | −9.23 |
| 2023 | 2.59 | 7.17 | −4.58 |
| 2024 | 3.22 | 5.66 | −2.44 |
| 2025 | 3.31 | 4.75 | −1.44 |
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Higgins Strategy. “When the rate on the debt rises above growth, the debt feeds on itself” Exhibit 5, The Interest Bill (Study XII). October 12, 2026. https://higginsstrategy.com/charts/12-03-r-minus-g-2002-2025/