Interest on National Debt Spikes
Since United States Speaker of the House Kevin McCarthy and Republican lawmakers allowed Democrats to raise the debt ceiling, America’s national debt has surged past $32 trillion. This presents a problem for the U.S. government as the amount of money it owes in interest payments consumes an ever larger share of tax revenue.
A foundation created by billionaire Peter G. Peterson estimated on June 20 that government interest payments on the national debt will total $663 billion (2.5 percent of its gross domestic product) in 2023. That is a 39 percent increase from the $476 billion the government spent on interest last year and a new record. It is also 80 percent of what the U.S. spends on its military.
Security threat: Financial historian Niall Ferguson has warned that nations and empires usually fall apart when the cost of servicing their debts exceeds the cost of defending their borders. Once this tipping point is reached, governments usually have to start slashing military budgets so they can make payments on the debt they already owe. Based on current budget projections, America could be spending more on interest payments than on national defense within the next year.
The Congressional Budget Office estimates that interest will cost more than $1.4 trillion in 2033 (more than any other spending category except Social Security and Medicare). That means the percent of tax revenue earmarked for debt payments may increase from 14 percent to 20 percent in the next decade.
Sudden collapse: The Prophet Micah wrote that just as end-time Israel (the United States and Britain, primarily) reached the zenith of its military power, God would suddenly throw down its strongholds and cut off its armaments. “And it shall come to pass in that day, saith the Lord, that I will cut off thy horses out of the midst of thee, and I will destroy thy chariots: And I will cut off the cities of thy land, and throw down all thy strong holds: And I will cut off witchcrafts out of thine hand; and thou shalt have no more soothsayers: Thy graven images also will I cut off, and thy standing images out of the midst of thee; and thou shalt no more worship the work of thine hands” (Micah 5:10-13).
America currently spends more than $800 billion a year on its military, but its $32 trillion national debt is a ticking time bomb ready to go off at any moment.
Learn more: Read “Can America Afford Its Military?”
