The head of the Congressional Budget Office warned lawmakers that the U.S. government is on track to pay more to its creditors than on its own military, as interest rates and debt levels continue to climb.
CBO chief Keith Hall told the Senate Budget Committee Wednesday that America’s net interest payments will triple over the coming decade, outpacing military expenditures. He called the data point “one of my favorite figures” used to highlight the challenges posed by the country’s ballooning debt.
His office’s budget and economic forecasts, published Monday, show net interest payments first outstripping defense outlays in fiscal 2023 and reaching $915 billion five years later. The increase will come as debt held by the public almost doubles to $28.7 trillion in fiscal 2028 from this year, according to the CBO, a non-partisan arm of Congress.
When Interest Takes Over
The U.S. government will start spending more on interest than defense in 2023
Source: Congressional Budget Office's April forecasts
“My point is that the interest cost is just starting to swamp things like defense spending,” Hall said. “Whatever the fix is going to be, it needs to be something that’s pretty big.”...
- ^ U.S. Deficit to Balloon Beyond $1 Trillion by 2020, CBO Says (2) (www.bloomberg.com)