The Middle East war is driving up the cost of public debt in rich countries which could jam state budgets and push governments to unfold austerity policies, economists warn. The yields demanded by investors to lend to governments by buying their bonds have peaked in recent days, indicating weakening confidence in their economies and inflation fears. The yield on the 30-year U.S. Treasury bond touched on May 19 its highest level since 2007 at 5.18 percent. Japanese and British 30-year bonds have hit records going back to 1999 and 1998 respectively, while benchmark 10-year yields have also surged. [...]