The low short rates are ones that the Fed has some control over, but the longer ones are up to what bond buyers have been willing to pay. And for some reason big money has been willing to get very low yields for a long time.
This may be due to a savings glut from the likes of China. It could also be from foreign lenders choosing to be repaid in dollars which has allowed the Fed to increase the quantity of money without it showing up here as inflation until now. The dollars have been sponged up outside the US. These are just possibilities I’ve read of in recent years to explain the low rates despite the growing money supply.
When rates do rise it won’t hurt the government for any already issued debt. It will affect new debt issued by the Treasury. So rolling over maturing issues will be affected as well as any new debt if Congress increases the debt limit.
A very large portion of the debt is held by the Fed for monetary management and those interest payments all revert to the Treasury making them have zero effect.
We are still in an era of very low rates. All through the Reagan years IIRC they were never below 5%. The low rates really didn’t start until right after 9-11.
The Federal Reserve is a semi-make work program. Has a bloated bureaucracy that I am sure has a serious affirmative action hiring program. Compensation is much higher than in in the dreaded private sector.
To pay for this jive, The Federal Reserve does retain some of its earnings. My guess it retains 5-7%, the remainder of earnings are remitted to the Federal Government.
BTW I was listening to Glen Beck last night, for two minutes he was recommending the book, “The Creature From Jekyll Island”