Going broke

The [Penn Warton Budget Model (PWBM)] brief also outlines the effects of real interest rate increases on future debt projections. In the base case, the authors project federal debt rising from 98 percent of GDP in 2023 to 189 percent in 2050. The Congressional Budget Office (CBO) forecast shows debt reaching 169 percent of GDP that same year. If the real average interest rate for U.S. borrowing rises by 50 basis points above the PWBM forecast of 2.3 percent, then federal debt would climb to 208 percent of GDP in 2050.

Source: James C. Capretta, American Enterprise Institute