How is this sustainable? What is the solution? Austerity? Inflation?
It's clearly not sustainable to be growing the national debt at 2 or 3 trillion per year, and especially not at 5% interest rates. People bring up Japan as some sort of model that GDP/Debt can go much higher than the US is currently at, while missing that Japan is paying 0.76% on the 10-yr notes today. In many ways, Japan is lucky that their economy is so tepid and impotent because if they had caught the inflation bug like the US, they would have had to raise rates significantly.
Needless to say, debt levels at 270% of GDP with 5% rates would cause a fiscal catastrophe in Japan. Their interest payments alone would exceed all government revenue. They would have to cut 100% of government services (military, medical, pensions, administration, legislation, the courts) AND raise taxes, or issue mountains of new debt in some sort of horrible debt spiral until there was no more demand for yen bonds, at which point there would be sovereign bankruptcy I suppose? IMF bailout of Japan?
At current rates, US government debt will hit $41 trillion this time next year. It grew $604 billion in the last thirty days, and every bond sold is at 5% interest or more. It's just not something that can be done forever unless the US economy starts growing 10-15% per year, or unless rates can be pushed down to 0% indefinitely with no negative consequences.
One thing is for sure, your current tax rate you are paying is as low as it will be for the rest of your lifetime.
This video by Ray Dalio explains it much better than I ever could:
As a consequence, "what is the solution?" will get sidelined by the question of "should we even solve anything?", even though high interest rates are clearly damaging.
On the actual question of how to solve it, I don't have any answer. Both austerity and inflation come with side-effects that may or may not increase that rate even more.