Here’s the number to keep in mind: $763 billion.
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.
Under Obama’s budget, in 2020 interest payments alone would amount to more than national-defense spending in that year. By 2023, interest payments alone would amount to more than all nondefense discretionary spending in that year.
As it is, interest payments on the national debt already amount to about 7 percent of all federal spending—that’s hundreds of billions of dollars a year spent on nothing but paying the price of failing to pay off previous spending, robbing today’s taxpayers to pay yesterday’s beneficiaries of government largesse.
That kind of spending on interest payments is not politically sustainable, and probably is not economically sustainable, either. American taxpayers are going to be none too eager to keep blowing a Pentagon-plus-sized hole in the budget, year in and year out, just to accommodate past spending.
Barack Obama has the luxury of knowing that there is not one person in Congress who takes an Obama budget proposal seriously. Put to the test, Senate Democrats have voted unanimously against an earlier Obama budget, and Democrats in both houses already have written off this latest fanciful proposal.
It does not stand a chance of being ratified into law, but it is worth noting the fact that the president of the United States has just proposed a budget that amounts to a national economic suicide pact. And he couldn’t even be bothered to do that on time. There may be a political case for his having done so, but as national economic leadership, this budget is grossly irresponsible.
— Kevin D. Williamson is a roving correspondent for National Review. His newest book, The End Is Near and It’s Going to Be Awesome, will be published in May.