By Neil SinhababuHere's a chart of yields on the ten-year Treasury note, from before 1980 to the present. If the government wants to borrow money, this is about the interest rate it has to pay.
See that drop at the very end? That's the financial crisis. People freaked out, dumping their stocks and mortgage bonds and other risky stuff, and jumped into what's still regarded as the ultimate safe investment: US Treasury bonds. So suddenly there were tons of people trying to lend us money, which means our interest rates dropped dramatically. They've come back up a little in the last few weeks, but we're still under 2.7% for a ten-year loan.
Now suppose you think that we need to invest more money in public goods of the kind that my middle school buddy (no kidding!) Ryan is talking about. If we do it now, we can finance our investments at really low interest rates.
