The cost to the U.S. government of servicing its $40 trillion national debt is easy to pin down: the Treasury publishes its own data on interest payments. The toll on households and individuals is far harder to measure. But a new report from the Committee for a Responsible Federal Budget (CRFB), a nonpartisan group that analyzes federal budget policy, argues that deficit reduction is the key to resolving the country's affordability crisis.

Affordability has become a political lightning rod, dominating the run-up to the 2024 presidential election and returning to the fore in 2026 ahead of the midterms. A July study from Pew Research found that the economy was the top-of-mind issue for voters, with 29% saying they wanted Congressional candidates to lay out plans to address price increases. A further 15% cited affordability and the cost of living specifically as their key issues.

The topic has become a problem for President Donald Trump, who is under pressure to normalize global oil supply chains disrupted by the U.S.-Iran conflict.

The CRFB argues there is a remedy within Congress's reach: addressing the national debt itself.

Fiscal discipline, the committee explains, could aid the interest-rate-setting Federal Reserve in its battle against inflation, which currently sits at 3.4%—well above the Fed's 2% target. “When interest rates remain well above the zero lower bound and the economy is performing near its productive capacity, deficit reduction can reduce excess demand and slow price growth,” the report states.

Deficit reduction would also boost supply, the committee argues, by easing the “crowding out” of private investment—the process by which government borrowing absorbs capital that might otherwise flow to private projects—a dynamic sources previously described to Fortune in connection with Treasury Secretary Scott Bessent's latest bond plan. “Deficit reduction can further reduce inflation by lowering self-reinforcing inflation expectations to the extent it reduces the likelihood that future policymakers will aim to inflate away the national debt,” the committee added.

The committee also ran the numbers on household savings if inflation—and, by extension, interest rates—were to come down: a 1.5 percentage point reduction in rates would save a family $5,800 per year on a $500,000 mortgage and $500 per year on a $50,000 car loan.

The income factor

For debt hawks, the camp most focused on reining in federal borrowing, the dollar value of U.S. debt is not the core concern—it is the country's debt-to-GDP ratio that raises alarm. The ratio captures the balance between how much a country has borrowed and its economic growth, and therefore the risk attached to lending to it.

The U.S. debt-to-GDP ratio now stands at approximately 123%. The nonpartisan Congressional Budget Office (CBO) estimates that stabilizing the figure would lift real per-person income growth by 10% over the next three decades, and by more than 44% compared with a high-debt scenario.

Applying the CBO's modeling, the CRFB adds: “To put these numbers in context, income per person would grow by $46,500 over the next three decades—in today’s dollars—with a stable debt, as opposed to $32,350 with rapidly rising debt. On average, people will thus enjoy $14,250 more annual income from stable debt—nearly $36,000 per household—as compared to rapidly rising debt.”

Those on the more optimistic side of the debt debate counter that the U.S. debt-to-GDP ratio is healthier than that of other developed economies. Japan's ratio stands at around 207%, according to the International Monetary Fund, and the country has experienced no bond market meltdown.

Policymakers—including the president—likewise argue the U.S. can grow its way out of the imbalance. “There's nothing magic about the $40 trillion number,” Bessent told CNBC last month. “And we can grow our way out of that.”

With the Treasury spending $3 billion a day in interest on the national debt, any such growth would be welcomed as soon as possible.

This story was originally featured on Fortune.com.