Trego's Mountain Ear

The Longer Game – by Jeffrey Carter – Points And Figures simplifies our nation’s budgeting problem:

“70% of the budget that is now $33 trillion in deficit is pre-planned mandatory spending that no one in Washington has the standing to stop. Like a kudzu plant, it grows every year and you can’t kill it. It’s hard to even slow down or trim.  .  .

We can squabble all we want. We can make our talking points. We can go on TV and play “gotcha” with the other party every single day. You know what? Every single day the budget deficit gets bigger because no single Senator or Representative will do anything about the 70% of the budget that grows every year and is bankrupting us.

It’s not the defense budget. It’s entitlements. It’s transfer payments. It’s programs like Social Security, Medicare, Medicaid, EBT/SNAP, and programs like that. I always hear the refrain “We are the richest country in the world and in human history but we can’t seem to take care of our poor”. I have news for you, no government can.”

U.S. Debt: Visualizing the $31.4 Trillion Owed in 2023 provides a visualization of the total, but also shows the debt by year (click the link to see even more years):

Year	Outstanding Debt	Year-Over-Year Increase
2023*	$31.4T	2%
2022	$30.9T	9%
2021	$28.4T	6%
2020	$26.9T	19%
2019	$22.7T	6%
2018	$21.5T	6%
2017	$20.2T	3%
2016	$19.6T	8%
2015	$18.2T	2%
2014	$17.8T	6%
2013	$16.7T	4%
2012	$16.1T	9%

 The article takes us back ten years at a time – it seems relevant to note that the last year the debt didn’t increase was 2000.  The Trump years (2017 to 2021) showed an increase of 34%.  The last 4 Obama years showed an increase of 20% – and it looks like Biden’s total will also be less than Trumps.

Growing interest in U.S. debt – POLITICO – Politico is regarded as left-slanting – but this article seems more like a fiscal conservative view:

“Now the Fed expects to keep its main policy rate above 5 percent through the end of next year. By the end of 2026, it could still be at roughly 3 percent. If that bears out, that’s a brave new world.

The piece of the budget eaten up by interest payments is already projected to be about 10 percent, or $663 billion, for fiscal 2023, according to the Center on Budget and Policy Priorities. And the Congressional Budget Office expects those costs to grow. That’s compared to an estimated $806 billion for national defense.

“If you look at the CBO outlook, we’re going to spend about $80 trillion over the next 10 years, and about $10 trillion of that is interest,” Douglas Holtz-Eakin, who headed the office under George W. Bush, told MM. That’s based on the 10-year Treasury note settling at 3.8 percent, compared to about 4.6 percent right now, leaving open the possibility that those costs could grow by, say, another trillion or so.

How much should we care? That’s tough to answer. There are, of course, modern monetary theorists who believe that government spending is too high only when it causes excessive inflation, and otherwise isn’t a problem.

But mainstream economists generally argue that there are costs to allowing government debt, and interest on it, to become too large in proportion to GDP, with implications for productivity and growth.

What’s less clear is whether voters care. Sure, they tend to say they do. But debt is an abstract idea that doesn’t seem to drive votes. Sarah Binder, a political science professor at George Washington University, said when it comes to principles, people tend to be conservative, criticizing the notion of “out-of-control spending.”

“But operationally people are kind of liberal,” balking at cuts to popular programs, she added. And they don’t want to pay more in taxes either.”

Somehow, it reminds me of my colleague’s Oldsmobile – new, shiny and just out of warranty.  Even before the engine blew, he owed more on the car than it was worth.  After the engine blew, the only folks that could work a trade in was the Oldsmobile dealership – he traded to a brand spanking new Olds, and owed more against it than the sticker price before he drove it off the lot.  When ten percent of your budget is interest, it is somewhere between bloody difficult and impossible to reduce the principle.  

Perhaps, instead of electing likable politicians, we should elect curmudgeons who can bite the bullet and cut down the national debt . . . and get the entitlements back into being less than half of the budget.  Obviously, the popular politicians haven’t been able to do the job.