The public sector paid R$1.205 trillion in interest in the 12 months through September, 17 times the primary deficit and 7.6 times the Bolsa Família budget. More than half of federal debt bonds are held by banks and investment funds. The small Tesouro Direto saver holds 3.1%.
One of the fathers of the Real Plan wants to cut the benchmark rate from 13.75% to 7.5% in a year, because it is interest, not spending, that makes public debt grow. Over 12 months, the public sector paid R$1.205 trillion in interest, 17 times the primary deficit. The idea reached Lula's campaign platform, and the harshest reaction came precisely from those who live by speculating with capital.
By the IMF's projection for 2026, Japan's government debt reaches 199.4% of GDP, Italy's 137.9% and America's 126.8%. Seven of the G20's 19 economies owe more than they produce in a year. Brazil is 8th, at 97%.
