I like your thought process and it might be a good way to go.

> Raise interest rates on debt. This will cause people to pay back existing debts

But this is risky for the stock market right? interest rates on debt are connected to the fed's interest rate and to bonds yields. Higher bond yields = stocks are less appealing. That could be fine during normal times but the stock market is very very high so the risk for a huge crash is high. Who knows what the result of a stock market crash might be, the 30s were one huge depression. During the current political climate I can see why the high-ups want to avoid that.

But It's something to think about what you're suggesting and it's very possible what you're suggesting will happen in some form or another.