So what is us government doing now?
Honestly — not much that actually solves the problem. Here's the real picture:
What Treasury is officially doing
1. Running auctions constantly — just to survive
In fiscal year 2025, Treasury held 444 auctions — borrowing $1.9 trillion for new operations and refinancing $9.1 trillion of maturing debt. The largest buyers were domestic money market funds and mutual funds, followed by broker-dealers and foreign investors. U.S. GAO
That's not strategy — that's just keeping the lights on.
2. Trying to be "regular and predictable"
Treasury's stated primary objective is to finance the government's borrowing needs at the lowest cost over time — issuing on a regular, predictable schedule to minimize investor uncertainty. Gao
In practice this means not doing anything dramatic that spooks markets. Boring by design.
3. Staying short-term — which is the problem
Treasury has actually been preferring to issue debt in the 2–7 year range, and the Fed is aligning its portfolio to match this shorter maturity preference — which could reduce support for longer-term Treasuries and add volatility at the 10-year and beyond. LPL Financial
This is the opposite of what many economists recommend. They're doubling down on short-term borrowing precisely because it's cheaper today — even though it creates the refinancing trap we discussed.
4. Exploring new instruments — tinkering at the edges
The Treasury Borrowing Advisory Committee is studying issuing SOFR-linked floating rate notes to diversify the front-end issuance mix and attract money market fund demand. Most dealers support it but warn of risks during funding market stress. U.S. Department of the Treasury
This is rearranging deck chairs — new instrument types don't solve the fundamental volume problem.
What GAO is telling Congress
GAO explicitly concluded that Treasury's debt management practices alone cannot address the important risks — and that Congress needs to address the unsustainable debt levels causing higher interest rates. As of February 2026, Congress has not acted on this recommendation. U.S. GAO
The brutal summary of what's actually happening
| What they should do | What they're actually doing |
|---|---|
| Extend debt to long maturities | Staying short-term, 2–7 years |
| Reduce deficit | Passed OBBBA adding $4+ trillion |
| Raise taxes | Cut taxes |
| Cut entitlements | No serious proposals |
| Sovereign wealth fund | Not discussed |
| Financial repression | Quietly, at the margins |
The one number that says it all
Interest rates are currently 40 basis points above CBO projections. If that persists for a decade, it adds $1.5 trillion to the debt on top of everything already projected — pushing debt to 124% of GDP versus the already alarming 120% forecast. Committee for a Responsible Federal Budget
The honest answer
The US government is essentially doing what a person drowning in credit card debt does — making minimum payments, opening new cards to pay old ones, and hoping something changes. No structural reform. No long-term plan. Just surviving the next auction, the next quarter, the next election cycle.
The GAO said it plainly: Treasury can manage the mechanics of borrowing. It cannot fix the political failure that keeps making the problem worse. That requires Congress — which has shown no appetite for the hard choices needed.