Because Treasury saw the elephant in the room. As Janet shopped around bonds to anyone that would take a meeting, China, Japan, Europe — there was no appetite for 30 year U.S. bonds with interest rates under 2% when Debt-to-GDP was above 120% following COVID stimulus. The market wouldn’t touch them — even if we asked.
So it wasn’t worth asking — because again, at this point, Treasury and Fed are just managing optics. So instead of refinancing our liabilities at historic lows, we front-loaded the interest burden. Which means the window for monetary discretion — raising or lowering rates, modulating the money supply, nudging inflation — is effectively closed.
At this point, lowering rates will be seen as an inflationary signal, and the bond market will punish us in turn. Just ask Japan.