What the insidious NYT seems to have missed, is that interest rates are low right now, the debt has remained stable in relation to GDP, and the real problem would be an increase in inflation. That would raise interest rates and drain everybodys asset base. Of course, GDP could look better as well.j-c-c wrote: ↑Tue Mar 12, 2019 6:44 amWhat is your point, that since our debt interest is currently low ( and with no future guarantees to remain so), keep spending?David Redszus wrote: ↑Tue Mar 12, 2019 12:53 amThe interest on the national debt is how much the federal government must pay on outstanding public debtj-c-c wrote: ↑Mon Mar 11, 2019 8:11 pm
First Follow the money.
1. It gets continuously rolled over, and because of changing interest rates, it can balloon in size
2. The people who most benefit from deficit spending, those that buy/finance this debt, worldwide
3. They are collecting interest right now, why the interest service is now 21%(?) of the annual budget, or some other incredible percentage, that is always rising.
each year. The current interest on the debt is $364 billion. That's from the federal budget for fiscal year
2019 (October 1, 2018, through September 30, 2019).
The public debt is $16.9 trillion. That's debt owed to individuals, businesses, and foreign central banks.
The interest rate on our national debt is about 2%. 364B/16.9T=.02%.
If we can entice other governments to lend the US money at a rate of 2%, our government is doing much
better than most banks.
Regardless, the rooster will eventually come home:
"As Debt Rises, the Government Will Soon Spend More on Interest Than on the Military
Tax cuts, spending increases and higher interest rates could make it harder to respond to future recessions and deal with other needs.
Interest payments on the federal debt could surpass the Defense Department budget in 2023.
Jeon Heon-Kyun/EPA, via Shutterstock
The federal government could soon pay more in interest on its debt than it spends on the military, Medicaid or children’s programs.
The run-up in borrowing costs is a one-two punch brought on by the need to finance a fast-growing budget deficit, worsened by tax cuts and steadily rising interest rates that will make the debt more expensive.
With less money coming in and more going toward interest, political leaders will find it harder to address pressing needs like fixing crumbling roads and bridges or to make emergency moves like pulling the economy out of future recessions.
Within a decade, more than $900 billion in interest payments will be due annually, easily outpacing spending on myriad other programs. Already the fastest-growing major government expense, the cost of interest is on track to hit $390 billion next year, nearly 50 percent more than in 2017, according to the Congressional Budget Office."
Sorry, NYT the sky is not falling. Start telling the truth and let citizens make up their own minds instead of listening to some 26 year old female j-school grad. Or Krugman.