Thread

10-year Treasury yield climbs above 5.3% to a level not seen in 24 years

122 points · 193 comments · kaycebasques

missedthecue · 1790820728 · focus · HN ↗
In 2026, entitlement spending + interest expense will be over 100% of federal tax revenue.
That's before the military, foreign aid, and everything that starts with "Department of"
1. toomuchtodo · 1790820989 · focus · HN ↗
  Yeah, cut the $1T/year in defense spending and raise taxes to pay down the debt (to cut $1T/year in interest expenses) and balance the budget. Entitlements remain because workers are entitled to those benefits they worked for. The same workers the wealthiest need to suck $5T+ a year of profit out of the economy.
  We used to have 94% top tax bracket rate at one point, and higher tax rates in general. We’ll find the will to raise taxes as soon as the bond market compels the spineless in Congress to find the will (as the cost of debt continues to rise into the future), because you cannot deceive the bond market.
  <a href="https://taxfoundation.org/data/all/federal/historical-income-tax-rates-brackets/" rel="nofollow">https://taxfoundation.org/data/all/federal/historical-income...
  <a href="https://www.axios.com/2026/09/27/rates-borrowing-yields-fiscal" rel="nofollow">https://www.axios.com/2026/09/27/rates-borrowing-yields-fisc...
  - In projections that the Congressional Budget Office produced last February, net interest costs are already at $1 trillion this year and on track to reach $2 trillion by 2035, meaning that much of federal spending is needed just to service old bills.
  - But those projections assumed 10-year Treasury yields were in the ballpark of 4.3%. They're now nearly a full percentage point higher than that.
  - In startling numbers that CBO released this week, in a scenario in which interest rates were 1 percentage point higher than its baseline, debt held by the public would grow to 222% of GDP in 2056, 47 percentage points higher than the baseline.
  <a href="https://www.cbo.gov/publication/62758" rel="nofollow">https://www.cbo.gov/publication/62758
  1. kccqzy · 1790823465 · focus · HN ↗
    I have seen no evidence that Congress cares about what the bond market thinks. In what scenario do you think the bond market can compel Congress?
    AnimalMuppet · 1790861535 · focus · HN ↗
    That may be true, but why is Congress the metric? Congress is broken. In how many of the last 20 years have they actually passed a budget? It might be two; I'm pretty sure it's not more than five. That's their most basic job, and they can't or won't do it.
    Whether Congress cares does not tell you whether there's a problem. The fact that Congress doesn't care is part of the problem - maybe the biggest part.
    robocat · 1790884024 · focus · HN ↗
    > and they can't or won't do it
    Instead of blaming Congress, perhaps blame democracy.
    Voters loath austerity, and they support spending.
    Watch the experiment happening live in New Zealand elections. Our incumbant conservative party (National) is aiming for a budget at about 30% of GDP. Our progressive party (Labour) wants to increase taxes and increase spending to maybe 33% of GDP.
    You can see if voters care about keeping spending in check, because it seems likely to be a central issue of campaigns. Although we have MMP voting so it isn't totally clear. Also note that I think most of our politicians would be seen as left-wing if looked at by anyone on the right.

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