$223 billion: This is how much further America sank into debt during February. It is the largest February deficit in history. Meanwhile, Republicans and Democrats argue over cigarette burns while the whole house is on fire. The world will soon learn that America will never balance the budget. When it does, the dollar will crash, inflation will soar, and your standard of living will plummet.

In case you were wondering: The previous record deficit was February last year, at $220.9 billion. Before that, it was February 2009 at $193.9 billion. They just keep getting worse and worse.

The latest figure, which came in a report from the Congressional Budget Office, shows just how juvenile politicians in Washington are. Republicans are pushing to cut $50 billion from the yearly budget. Democrats say they can accept no more than $6 billion.

Who is going to save the nation from such madness? Just the monthly deficit for February is more than four times as much as even the most “extreme” yearly cuts.

Politicians are bickering while the nation’s finances go up in flames. Under current projections, the nation will need to borrow around $1.5 trillion to cover its “needs” this year—that is $4.1 billion per day, each and every day, of new borrowing. Republicans want to cut just over 12 days of borrowing. Democrats feel they can only support one and a half days’ worth of borrowing cuts.

Is Washington insane?

The biggest reason a crisis hasn’t already erupted is that America is benefiting from bigger problems in North Africa, Greece, Ireland and Spain. But those problems will not last. Europe will eventually get its act together, and when it does, investor attention will turn to America—and then America’s smoldering debt problems will suddenly turn into an inferno.

That time may be nearing. America is approaching the congressionally mandated debt ceiling of $14.2 trillion. If a new budget is not passed by March 18, government bills may stop being paid. Just like in California, vendors could be stiffed until the impasse is resolved.

The interest on the national debt has now reached the danger zone too. So far this year taxpayers have paid 12.5 percent more in interest than they did last year at this time. But this is just the beginning.

How much of an interest rate rise would it take to crash America? America has taken on so much debt over the past two years that if rates just rose back up to 5 percent (where they were in 2007) the interest on the national debt would be almost $700 billion per year, according to Dallas-based Hayman Advisors. Contrast that to America’s projected revenues of $2.23 trillion for fiscal year 2011.

In other words, if rates just go back to where they were a little over three years ago, a third of our income will need to be used just to pay the debt. Where is the money going to come from for all the untouchables like defense, Medicare, Medicaid, Social Security, etc.?

What if rates shoot up to the high single digits? Or worse, head into the high teens, as happened during the 1970s? The whole federal budget might be needed—just to pay the interest.

Each year, America’s debt problems will get worse and worse. The current presidential budget calls for $9 trillion in additional borrowing before the budget is magically balanced by hoped-for economic growth in 2020. But even if the budget is balanced by that time, America will still have an additional $9 trillion in debt—plus all the extra interest payments.

What this means is that the Federal Reserve can no longer afford to raise interest rates in any meaningful way. Low interest rates are here to stay—and that means the dollar is doomed to devaluation.

And remember: The dollar is the measure of your standard of living. As the dollar drops in value, your purchasing power deteriorates with it. America’s big-spending days may be about to burn it in a very big way.

For more information on the critical danger of America’s debt, read Stephen Flurry’s column “Economic Warfare: Hastening the Demise of America.”