The U.S. government is fast straining resources needed to meet interest payments on the national debt, which approaches a mind-numbing $11 trillion. And like homeowners who took out adjustable-rate mortgages, the government faces the prospect of seeing this debt — now at relatively low interest rates — rolling over to higher rates, multiplying the financial pain.
How did we get in this fix? Suppose this month you want to spend more money than your income allows, so you borrow. The amount you borrowed (and now owe) is called your “debt”, which you need to pay interest on. If next month you don't have enough money to cover your spending, you must borrow some more, and in government terms this is another “deficit”. (BTW, some estimate that the federal deficit will exceed $1 trillion this fiscal year!). And of course you need to pay interest on these loans. If you have a deficit every month, you keep borrowing and your debt grows.
Eventually the interest payment on your loan could become bigger than any other item in your budget. So at some point, all you can do is pay the interest payment, and you don't have any money left over for anything else.
Well, each year since 1969, Congress has spent more money than its income! The total borrowed, or National Debt, is NOW nearing $11,000,000,000,000 and growing. We pay interest on that huge debt.
And this National Debt continues to increase at roughly 4 billion dollars a day. Basically, it takes ALL the taxes paid by ALL the individual taxpayers west of the Mississippi river just to pay the INTEREST on the National Debt each year.
P.S. - And in case you think this money stays in the USA and helps our economy in some way, since more than a third of the debt is owed to foreign countries, more and more of this interest, aka as your tax dollars, is going to foreigners every year.
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