The Sounding Line

Charting New Waters

Taps Coogan: 36% of the US National Debt Is Accumulated Interest

Submitted by Taps Coogan on the 19th of July 2018 to The Sounding Line.

Enjoy The Sounding Line? Click here to subscribe.

The last time the US completely paid off the national debt was in 1840. It was the result of decades of balanced budgets under Presidents James Monroe, John Quincy Adams, and Andrew Jackson.

In the 179 years since 1840 (counting the 2018 budget), the US has run a deficit 109 times and a surplus or balanced budget just 70 times, amounting to a cumulative net deficit of $14.2 trillion. All of the surpluses combined in the last 179 years amount to $580 billion, less than the deficit in 2017 alone ($665 billion).

Since the national debt was last eliminated in 1840, the US has paid a cumulative $7.8 trillion of interest on the national debt. Despite running ‘only’ $14.2 trillion in deficits over that last 179 years, and despite having already repaid essentially all debt issued more than 30 years ago, the national debt today is $21.4 trillion. The difference between the cumulative deficit and the national debt, $7.2 trillion, represents off-balance sheet spending and circular lending schemes like the Social Security ‘Trust Fund.’

A full 36% of today’s national debt is, in effect, accumulated interest paid on past debt. In a sense, a portion of the money the government borrowed in 1841 is still being paid for today via rolling the debt forward.

Data Source: USGovernmentdebt.us

The last time the national debt decreased on a yearly basis was in 2000 when it fell from $5.7 to $5.6 trillion dollars. Since 2000, the US national debt has nearly quadrupled to $21.2 trillion and the US has spent a cumulative $4.1 trillion dollars on interest expenses, more than during all previous American history combined.

Yet, because so much of the recent growth in the national debt has taken place since the 2008 Financial Crisis, and has been borrowed at historically low interest rates, taxpayers have been shielded from much of its cost. However, if the federal government continues to borrow at the same rate or higher, as it is planning to do, there is a good chance that future borrowing will come at significantly higher interest rates. Consider that the government already spends more servicing the national debt than the combined amount spent on food assistance for the poor plus the departments of: Homeland Security, Housing and Human Development, Energy, Justice, the State Department, NASA, Agriculture, Transportation, the Interior, and the EPA. If debt levels and interest rates rise, even more government spending will be diverted from real programs towards servicing the national debt. It is a total waste of taxpayer money.

Interest Expense versus other federal spending
Data Source: The Balance

Now is the time to balance the federal budget. The economy is expanding, the labor market is relatively strong, the need for large fiscal stimulus is low, and borrowing may get much more expensive in the near future. In the long run, not doing so is simply a massive waste of taxpayer money.

This article was updated on August 28th, 2019.

If you would like to be updated via email when we post a new article, please click here. It’s free and we won’t send any promotional materials.

July 19, 2018 Taps Coogan

Post navigation

The Tariffs China Actually Imposes on the US → ← The Poverty Rate of Every County in the US

5
Leave a Reply

avatar
wpdiscuz_captcharefresh
1 Comment threads
4 Thread replies
0 Followers
 
Most reacted comment
Hottest comment thread
4 Comment authors
Mary Jo and Cleator BoTaps CooganMattHamp Recent comment authors
avatar
wpdiscuz_captcharefresh
  Subscribe  
Notify of
Hamp
Guest
Hamp

Will never happen. Fiscal control that is. It’s easy to be Santa instead of making tough budgetary decisions like most families have to do. Total financial collapse & Reset is baked into the cake.

Vote Up70Vote Down Reply
1 year ago
Taps Coogan
Author
Taps Coogan

It is unlikely, though given the stakes, one can hope

Vote Up00Vote Down Reply
1 year ago
Matt
Guest
Matt

Balancing your budget the month before you go bankrupt makes total sense… it can’t be fixed without default

Vote Up10Vote Down Reply
1 year ago
Taps Coogan
Author
Taps Coogan

If you balanced your budget, you wouldn’t be going bankrupt, cause you’d be making your interest payments.

It’s worth a shot

Vote Up00Vote Down Reply
1 year ago
Mary Jo and Cleator Bo
Guest
Mary Jo and Cleator Bo

“Reset is baked into the cake.” By design.
BIS IMF have been warning.. openly and descriptively.
War and Reset.. this is it, now or never. Part of reason why nobody (either party) talks seriously about debt. Canada sold all of its gold.. think about it.
New currency paradigm. AI Robotics Quantum computing .. Homo Evolutis. Natural progression of species.

Vote Up00Vote Down Reply
2 months ago

TOP NEWS STORIES

  • U.S. Has More Children in Single-Parent Homes Than Any Other Nation
  • The State of the Canadian and American Debt Slaves and the Bank of Canada’s Response
  • How the World Learned of China’s Mass Internment Camps
  • China Launches Campaign to Redefine Human Rights as Being Something Other Than Human Rights
  • Endless Fields of Unharvested Corn, as Seen from Space
  • Turkey Unveils Small, Armed Drone
  • Stop the Madness of NATO Expansion
  • One of Europe’s Worst Famines Was Likely Caused by Massive Flooding, Tree Ring Data Shows
  • Gasoline, Rent Lead Uptick in US Inflation
  • World Bank Fund for Poor Countries Gets Record Boost
  • Dangerous: Chinese Developers Turn to Foreign Currency Bonds for Funding as Beijing Tightens Lending
  • Chinese Trade in Hides for ‘Traditional Medicine’ Has Led to Global Donkey Massacre; Population Halved
  • An Abundance of Aluminum Scrap Spurs Investment in US Recyclers
  • China Says It Has Agreed to US Trade Deal Text
  • Coal Employment in US Cut Nearly in Half Since 2011. Most of Appalachia’s Mines Closed
  • Watch the Pentagon Test a Previously Banned Ballistic Missile
  • Interesting: Russia’s Economy Is Signaling an Oil Price Rally
  • Japanese Economy: Deja Vu – But Worse
  • China Suffers Biggest Dollar Bond Default by State-Owned Company in Two Decades
  • Germany on Alert as African Swine Fever Nears Border
  • Japan Looks to Strengthen Oil Reserves Strategy
  • The Vatican Is Using Donations for the Poor to Fight Its Budget Deficit. Less than 10% Goes to Poor
  • Ticking Time Bomb of Record High Corporate Debt
  • The Global Auto Market Collapse in Four Charts
  • This is How the Biggest Sector of the US Economy Is Doing
  • Scientists Discovered 71 New Species in 2019
  • Fed Will Flood Market with Gargantuan $500 Billion in Temporary Liquidity to Avoid Year-End Repo Crisis
  • Active vs. Passive: Why It Appears that You Can’t Beat an Index
  • The Oldest Cave Paintings Ever Found Shows Supernatural Figures on the Hunt
  • Picked by Slaves: Coffee Crisis Brews in Brazil
  • Oxen and Horses Put back to Work in Cuba
  • Feds Collect Record Taxes Through November. Still Run near Record $343.3 Billion Deficit
  • Global Stocks on Verge of All Time High After Fed Signals Endless Accommodation
  • Google Maps Tracks Everywhere You Go. Here’s How to Automatically ‘Delete’ What It Stores
  • Chicago, Detroit “Least-Prepared” for a Recession, Says New Moody’s Report
  • World Bank to Reduce Lending to China
  • Small Businesses & CEOs Differ on the Economy
  • Things You Shouldn’t Have to Deny: Saudi Arabia’s Finance Minister Rejects Claims the Kingdom Is Running Short on Cash
  • Abandoned Nuclear Missile Complex in Arizona for Sale: $400,000
  • Volkswagen Charged with Violating Vehicle Emission Standards in Canada
  • JPMorgan Warns of Rise in Emerging Market Sovereign Distressed Debt
  • The Long Fight to Clean up America’s Cold War Nuclear Waste
  • For First Time Since Manhattan Project, US Army Will Fund Rare Earths Plant for Weapons Development
  • Inevitable: Pedestrian Fatally Crushed Between Two Parked Cars After One Vehicle Is Started Remotely
  • Turkey Wants to Import the World’s Gold, with Fewer Questions Asked
  • Chevron’s $11 Billion Write Down Is a Warning for the Oil Industry
  • China Eyes New Energy Exchange to Expand Global Oil and Gas Trade
  • Archaeologists Unearth Hundreds of Cuneiform Tablets in Central Iraq
  • The Chinese City Struggling After Samsung Closes Its Last Factory in China
  • 2000-Tear-Old Iron Age Shield Discovered in ‘Warrior Grave’ in Yorkshire
  • First Commercial Electric Plane Takes Flight in Canada
  • China Remains World’s Biggest Jailer of Journalists
  • Gold Miners Expected to Continue M&A Spree in 2020
  • France Unveils Controversial Pension Reforms
  • U.S. Military Returns Four Bases to South Korea




Pages

  • Home
  • About/Contact us…
  • Donate
  • Commenting Policy
  • Privacy Policy
  • Disclaimer

Seach

Categories

Login

  • Log in
  • Entries feed
  • Comments feed
  • WordPress.org
Copyright © 2019 - TheSoundingLine.com | -All rights reserved
wpDiscuz