{"id":2669810,"date":"2026-09-25T09:09:49","date_gmt":"2026-09-25T13:09:49","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/utm_sourcerssutm_mediumrssutm_campaignrising-interest-rates-push-washington-toward-another-fiscal-crisis\/"},"modified":"2026-09-25T09:12:42","modified_gmt":"2026-09-25T13:12:42","slug":"utm_sourcerssutm_mediumrssutm_campaignrising-interest-rates-push-washington-toward-another-fiscal-crisis","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/utm_sourcerssutm_mediumrssutm_campaignrising-interest-rates-push-washington-toward-another-fiscal-crisis\/","title":{"rendered":"Interest Rates Push Washington Toward Another Fiscal Crisis"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">16<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Futm_sourcerssutm_mediumrssutm_campaignrising-interest-rates-push-washington-toward-another-fiscal-crisis%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=2669810&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><p>The article discusses Herbert Stein\u2019s Law, which states that \u201cif something cannot go on forever, it will stop,\u201d observing that rising interest rates exemplify this principle. the recent increase in <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/top-gop-senator-rips-federal-reserve-for-not-complying-with-congressional-probe-into-woke-mission-creep\/\" title=\"Top GOP Senator Rips Federal Reserve For Not Complying With Congressional Probe Into \u2018Woke Mission Creep\u2019\">long-term interest rates<\/a> is driven by concerns over persistent inflation, high spending on data centers and AI, and fears about the federal government&#8217;s growing debt and its ability to service it. Higher interest rates lead to increased debt service costs, making mortgages more expensive and straining the federal budget, with projections indicating that interest payments could surpass spending on programs like Medicare and Social Security within a decade if rates stay elevated.<\/p>\n<p>The piece highlights the looming risk of a fiscal crisis, especially when interest rates exceed economic growth, reducing the nation&#8217;s ability to grow out of its debt problems. Experts warn that continued borrowing and rising rates could trigger a crisis, with some policymakers, like Jared Bernstein, expressing concern over the unsustainable trajectory of deficits and debt, despite traditionally being opposed to budget cuts.<\/p>\n<p>The author emphasizes that addressing the nation\u2019s fiscal issues depends on political will,which currently seems lacking,and suggests that a financial crisis might be the only catalyst for meaningful reform. Until then, the inevitable consequence of Stein\u2019s Law is that unchecked fiscal policies will eventually lead to significant economic repercussions, likely causing discomfort for the American people in the future.  <\/p>\n<p class=\"readmore\">\n    <button onclick=\"showReadMore()\" id=\"readmorebtn\">Read more&#8230;<\/button>\n<\/p>\n<hr id=\"line\">\n<span id=\"more\"><\/p>\n<div>\n<p><a href=\"https:\/\/en.wikipedia.org\/wiki\/Herbert_Stein#Stein's_Law\" target=\"_blank\" rel=\"noreferrer noopener\">Stein\u2019s Law<\/a>, named for noted economist Herbert Stein (the father of policy adviser and <a href=\"https:\/\/www.youtube.com\/watch?v=yuOHbyuanbY\" target=\"_blank\" rel=\"noreferrer noopener\">actor Ben Stein<\/a>), holds that \u201cif something cannot go on forever, it will stop,\u201d sooner or later. As interest rates slowly creep up, Americans may be witnessing the principles of Stein\u2019s Law in action.<\/p>\n<p>The recent rise in long-term interest rates has many causes, including concern over persistent inflation and the explosion in spending on data centers and artificial intelligence, which has sucked up so much money within the economy as to raise the cost of borrowing across-the-board. But rising interest rates also reflect concern that the federal government will not be able to pay its rapidly rising debt, even as it makes that debt more costly to service.<\/p>\n<h2><strong>Greater Debt Service Costs<\/strong><\/h2>\n<p>Increases in long-term interest rates <a href=\"https:\/\/thefederalist.com\/2026\/05\/12\/how-our-national-debt-jeopardizes-families-futures\/\" target=\"_blank\" rel=\"noreferrer noopener\">make mortgages more costly<\/a>, exacerbating the price pressures many families currently face. But with respect to the federal budget, <a href=\"https:\/\/amzn.to\/3YuVZYV\" >rising interest rates present short-term<\/a> and long-term concerns.<\/p>\n<p>In the short term, as one <a href=\"https:\/\/fortune.com\/2026\/09\/19\/treasury-yields-cbo-forecasts-us-debt-interest-costs-deficits\/\" target=\"_blank\" rel=\"noreferrer noopener\">article noted<\/a>, the recent rise in rates on the 10-year Treasury note to 5 percent already exceed the Congressional Budget Office\u2019s projections for the entire decade. In February, CBO\u2019s <a href=\"https:\/\/www.cbo.gov\/system\/files\/2026-02\/61882-Outlook-2026.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">most recent forecast<\/a> for the Budget and Economic Outlook assumed that 10-year interest rates would average 4.1 percent in Fiscal Year 2026 (which ends September 30), 4.2 percent in 2027, 4.3 percent from 2028 through 2031, and 4.4 percent from 2032 through the end of its projection period in 2036.<\/p>\n<p>Interest rates above projections could add <a href=\"https:\/\/www.crfb.org\/blogs\/1-higher-interest-rates-add-35-trillion-debt\" target=\"_blank\" rel=\"noreferrer noopener\">trillions of dollars<\/a> in additional debt to a budget forecast that <a href=\"https:\/\/thefederalist.com\/2026\/02\/20\/democrats-claim-gop-gutted-medicaid-federal-data-shows-the-opposite\/\" target=\"_blank\" rel=\"noreferrer noopener\">already looks bleak<\/a>. The Center for a Responsible Federal Budget <a href=\"https:\/\/www.crfb.org\/press-releases\/5-interest-rates-are-troubling-sign-road-ahead-0\" target=\"_blank\" rel=\"noreferrer noopener\">notes<\/a> that, if <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/inflation-falls-to-3-1-in-november-in-positive-sign-for-economy\/\" title=\"November sees a positive economic sign as inflation drops to 3.1%\">interest rates remain elevated<\/a> as at present, within a decade Washington will \u201cbe spending more on interest [to finance the debt] than Medicare or Social Security retirement benefits.\u201d<\/p>\n<h2><strong>Debt Bomb Looming?<\/strong><\/h2>\n<p>As CRFB also notes, the bigger long-term concern lies in the chance of a fiscal crisis. When interest rates exceed America\u2019s economic growth, the nation\u2019s ability to grow its way out of our self-imposed fiscal hole dramatically declines. And the rise in interest rates, coupled with Washington\u2019s <a href=\"https:\/\/thefederalist.com\/2024\/06\/24\/two-trillion-dollar-deficits-show-washington-has-a-spending-problem\/\" target=\"_blank\" rel=\"noreferrer noopener\">continued efforts<\/a> to add to the nation\u2019s debt pile, accelerates the day when that crisis will hit.<\/p>\n<p>Recently, Jared Bernstein wrote an <a href=\"https:\/\/archive.ph\/MXBL9\" target=\"_blank\" rel=\"noreferrer noopener\">op-ed<\/a> in the New York Times highlighting the potential for a fiscal crisis. The article\u2019s title notes that Bernstein, who chaired the Council of Economic Advisers under President Biden, has \u201cnever been a budget hawk\u201d \u2014 a true enough statement.<\/p>\n<p>Yet Washington\u2019s irresponsible behavior has given Bernstein concern over the nation\u2019s financial trajectory. He notes that \u201cour annual deficits, currently about 6 percent of GDP, are way above where history says they should be. We\u2019re not in a recession, but we\u2019re borrowing as though we were,\u201d and that \u201cpolitically, neither party shows any interest in addressing the problem.\u201d<\/p>\n<p>Put aside for a moment the fact that the Administration Bernstein most recently worked for helped create the debt and deficit problems that Bernstein now criticizes, and would have exacerbated the problem further had Biden\u2019s <a href=\"https:\/\/thefederalist.com\/2021\/12\/13\/republicans-should-force-democrats-to-vote-on-the-full-5-trillion-build-back-bankrupt\/\" target=\"_blank\" rel=\"noreferrer noopener\">Build Back Bankrupt bill<\/a> become law. His flawed history doesn\u2019t make him wrong about the need to get our fiscal house in order now.<\/p>\n<h2><strong>Stop Overspending<\/strong><\/h2>\n<p>Of course, taking action to address our fiscal deficits assumes that anyone in Washington has the political will to do so. But to the extent that our politicians lack any sense of spine to make tough choices \u2014 in part, it must be said, because the American people themselves want to have their fiscal cake and eat it too \u2014 a cynic might argue that the recent groanings in the bond market actually represent \u201cgood bad news.\u201d<\/p>\n<p>After all, if only a financial crisis will force our nation \u2014 both its politicians and the public at large \u2014 to get serious about its fiscal future, better to have it when federal debt stands at <a href=\"https:\/\/fiscaldata.treasury.gov\/datasets\/debt-to-the-penny\/debt-to-the-penny\" target=\"_blank\" rel=\"noreferrer noopener\">$40 trillion<\/a> than at some even higher number. Either way, Stein\u2019s Law will eventually take effect \u2014 and the American people likely will not like the consequences when it does.<\/p>\n<hr>\n<div>\n<p>      Chris Jacobs is founder and CEO of Juniper Research Group and author of the book &#8220;<a href=\"https:\/\/www.amazon.com\/dp\/1645720020\">The Case Against Single Payer<\/a>.&#8221; He is on Twitter: <a href=\"http:\/\/twitter.com\/chrisjacobsHC\">@chrisjacobsHC<\/a>.<\/p>\n<\/div><\/div>\n<p><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Stein\u2019s Law predicts eventual economic limits as rates rise<\/p>\n","protected":false},"author":521,"featured_media":2669811,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/thefederalist.com\/wp-content\/uploads\/2026\/09\/pexels-mikhail-nilov-6963030.jpg","fifu_image_alt":"","footnotes":""},"categories":[],"tags":[63384,48375,33477,86229],"class_list":["post-2669810","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","tag-fiscal-crisis","tag-government-debt","tag-interest-rates","tag-washington-economy"],"fifu_image_url":"https:\/\/thefederalist.com\/wp-content\/uploads\/2026\/09\/pexels-mikhail-nilov-6963030.jpg","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2669810","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/521"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=2669810"}],"version-history":[{"count":3,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2669810\/revisions"}],"predecessor-version":[{"id":2669814,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2669810\/revisions\/2669814"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/2669811"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=2669810"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=2669810"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=2669810"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}