YES! 0.7%* of the federal debt! That’ll help! *of quarterly un-adjusted federal debt
You mean deficit, I’m guessing? The US federal government’s deficit is growing by about $1.3 trillion per year lately so this comes out to about 0.9% of the annual deficit over each of the next ten years. I’m going to assume that’s what you mean - 0.7% and 0.9% are the sort of order-of-magnitude equivalent approximations a physicist is satisfied with, even though the difference in this context is a couple billion dollars. That deficit is projected to fall over the next few years and this is probably reasonable as the economy grows and stimulus spending (in terms of payroll tax cut and so forth) as well as military expenditures wind down a bit.
But let’s say the Office of Budget Management is being way too optimistic and assume that this is only going to cut the deficit by 1% each year over the next ten years relative to the current situation. And the policy instrument used to do so hits only the top third of the top one percent and hits them by encouraging them to spend the money or give it to their grandkids now rather than socking it away so their grandkids can have it when they’re dead. Can you think of any other politically feasible policy to cut so much spending at so light a cost?
On a broader scale, it’s probably worth noting that the yields on US Treasury bonds are pretty much as low as they’ve ever been. This is partially due to the Federal Reserve but (as the European Central Bank has demonstrated) central bank interference can’t drive down interest rates all the way. Clearly investors don’t regard US federal government debt as a risk over the next decade or two. And if they don’t see a risk, why worry about it at all? This whole song and dance right now is a piece of theatre intended to show how much Republicans Care About The Deficit despite the fact that bond yields - the actual free-market indicator of how important the deficit is - don’t show any alarm at all.
Is this a clearer explanation of what’s happening?