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QUESTION
US has never defaulted on a loan or missed an interest payment. Current taxpayers pay the interest on the Federal debt. Thus, without a national...
US has never defaulted on a loan or missed an interest payment. Current taxpayers pay the interest on the Federal debt. Thus, without a national debt, current taxes would be lower. Are these taxes "lost" to the economy? The interest is paid to the bondholders. The bondholders are other consumers, firms, governments, foreigners, and the FED. WHO RECEIVES THE INTEREST PAYMENTS ON THE FEDERAL DEBT?
