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U.S. federal debt added up to $908 billion in 1980, but today, nearly 40 years later, the number comes in around $20 trillion. That the amount owed by U.S. taxpayers has soared over twenty-fold would, in a static world, correlate with a huge increase in borrowing costs for the U.S. Treasury.
Except borrowing costs haven’t risen. While the yield on 10-Year U.S. Treasuries was 10.8 percent in 1980, as of today the yield has declined to 2.27%. Yes, you read that right, amid soaring federal debt the cost of government borrowing has plummeted.
Which brings us to Kevin Williamson’s recent commentary at National Review about Republican efforts to cut taxes. [...] Taxes on income and corporations are still way too burdensome (the corporate tax is a double tax on individual earnings, and should be zero), but the simple fact that the five most valuable companies in the world are all U.S. based is a certain reminder that the 35% U.S. corporate tax rate is not the actual penalty levied on American companies.