Americans have $1 trillion problem

While large numbers defy comprehension, Americans should try to wrap their minds around the huge sums of money owed on the fastest growing segment of the federal budget. The interest expense on the national debt will hit the $1 trillion mark in a decade then become a consistent $1 trillion outlay each year. While economists generally track spending, revenues, and deficits as a share of gross domestic output, there is something to be said about the sheer magnitude of an annual interest cost of $1 trillion, and the profound effect that a bill of that size would have on the budget.

Millions, billions, and trillions may be phonetically similar, but they have vastly different magnitudes. A million is certainly large, but a trillion is a million times a million. While a $5.7 billion disagreement on a wall may have shut down the government for more than a month, budget debates having a $1 trillion interest expense at their core, enough to fund a wall long enough to wrap around the world twice, will be substantially worse...

Americans should not be surprised by the magnitude of this interest cost because the federal government has for many years followed a deliberate policy of spending more money than it collects, thereby requiring heavy borrowing in good times and bad. Even now with low unemployment and interest rates, high asset values, and an expanding economy, the United States finds itself in a $1 trillion budget deficit pattern with little political will to alter a design where spending growth steadily outpaces revenues.