The Big Think

April 16, 2013

Numbers

Filed under: Politics — jasony @ 3:00 pm

I’m so incredibly tired of talking to friends who think our country can continue to charge on the national credit card, that there are no repercussions to the future for spending the way we are today, and that we can have things as a country and not pay for them. But once more into the breach, dear friends:

If enacted, Barack Obama’s latest budget would mean that in just ten years, interest payments alone on the national debt would begin pushing the trillion-dollar mark: $763 billion a year by 2023. That may be a rosy estimate: It assumes that interest rates, currently near historic lows, do not rise a great deal over the next ten years as the Treasury continues to pile up new debt. If interest rates do climb a bit higher — not even to their historical average, but higher than they have been of late — then those interest payments easily could be more than $1 trillion a year.

But let’s stay with that $763 billion a year for now. How much money is that? It is more money than the federal government spent on anything in 2011: The largest single spending item in 2011, Social Security, amounted to only $725 billion. Department of Defense spending was only (only!) $700 billion, and all nondefense discretionary spending combined amounted to only $646 billion. If you believe the welfare state is too expensive now, or that we spend too much money on the military, consider that President Obama proposes to spend more than that merely making interest payments on all the debt his budget would help pile up. How much debt? How about $8.5 trillion in new debt over the next decade, for a total of more than $25 trillion in national debt. At 6 percent interest, it would cost us $1.5 trillion a year to service that debt: about the size of President Clinton’s entire proposed budget for 1995.

The one number you need to know.

This is not about politics, partisanship, or having one side win over the other (except that I would love for any sane side to have a shot at running things for a while). It’s about extrapolating a simple, inexorable, undeniable debt curve into the future and adding my voice to the growing chorus that is shouting what can’t go on forever won’t. We have to stop this insanity while there is still time. Assuming there still is.

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