If national debt is owned by domestic citizens, future interest payments just transfer funds from one group of Americans to another.

Question

Quizplus · Accepted Answer

If the national debt is owned by domestic citizens, the future interest payments will simply transfer funds from one American citizen to another. This means that the overall impact of the interest payments on the economy is relatively neutral, as the money is simply changing hands within the same country. However, if the national debt is owned by foreign entities, the interest payments may lead to an outflow of funds from the country and could have a more significant impact on the economy.

If National Debt Is Owned by Domestic Citizens, Future Interest