Why Governments Pay Rent to Themselves

The Fiscal Policy Podcast with Fexingo: Government Budgets, Stimulus, and Public Spending · May 31, 2026 · 10m · transcript

Episode 22 of The Fiscal Policy Podcast digs into a strange but massive line item in federal budgets: intragovernmental payments. Every year, the U.S. Treasury pays itself hundreds of billions of dollars in interest on trust fund holdings. Lucas and Luna unpack how this circular accounting works, why it matters for Social Security and the debt ceiling, and what happens when the government owes itself trillions. They walk through the mechanics using the Social Security Trust Fund as a concrete example, explain why these payments inflate the deficit without changing net wealth, and ask whether…