The national debt is so large that a significant portion of federal spending is allocated as interest to service the debt. More than $200 billion is spent every year on debt interest. That amounts to more than a thousand dollars per working American per year. Keynesian economists talk about the virtues of deficit spending, yet now one of America’s most expensive programs is simply paying interest on the debt, the principal of which is never paid down.
When Congress and the president argue over the budget they do not even have serious proposals to end the deficit—the yearly increase in the debt—much less the debt itself. But this problem needs to be addressed if America is ever going to get back on track. Large personal or household debt can be devastating, but when the whole nation is drowning in this much debt, the impending disaster is far greater. We have seen in Greece and elsewhere the results of a nation living beyond its means. Unfortunately, the United States is not very different in its own behavior, and without a dramatic change in policy, the consequences will be calamitous.
Learn more about the Debt Interest problem and the solutions:
“To Whom Does the U.S. Government Owe the Most Money?”
Craig Eyermann (MyGovCost) April 9, 2013
“Federal Government Debt Undermines the Programs It Finances”
Randall Holcombe (The Beacon) January 21, 2013
“An Easy Solution to the Government’s Debt-Ceiling Impasse”
Robert Higgs (The Beacon) July 14, 2011
“Could the U.S. Default on Its Debt?”
Dominick T. Armentano (Herald News) February 17, 2010
“The National Debt vs. the Deficit”
Jeffrey Rogers Hummel (The Beacon) June 6, 2009