America's Greatest Enemy Is Neither China nor Russia (It's Debt)

What looked possible some years ago have with recent economic policy decisions turned into a realistic scenario: the United States face a technical default.

The figures and forecasts published by the Congressional Budget Office (CBO) leave little doubt. Currently, net interest burden accounts for 1.6 percent of Gross Domestic Product (GDP) equal to 9.4 percent of federal revenue absorbing about one out of every ten U.S. dollars of federal revenue. In 2022—four years from now—it will be 2.7 percent of GDP equal to 16 percent of federal revenue absorbing one out of every six U.S dollars of federal revenue. Measured in share of total outlays, net interest will jump from 7.6 percent in 2018 to 12.2 percent in 2022 and 13 percent in 2028. This forecast though is based on very optimistic assumptions for the U.S.. economy. Taking changes over the preceding couple of weeks into account, a net interest burden of 20 percent of total federal revenue looks realistic—a staggering figure with every American seeing one of every five U.S. dollars paid to the government used to finance debt.

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http://nationalinterest.org/feature/americas-greatest-enemy-neither-china-nor-russia-its-debt-25584

On Friday, August 25, 2023 at 3:55:58 PM UTC-7, ltlee1 wrote:
> America's Greatest Enemy Is Neither China nor Russia (It's Debt)
>
> What looked possible some years ago have with recent economic policy decisions turned into a realistic scenario: the United States face a technical default.
>
> The figures and forecasts published by the Congressional Budget Office (CBO) leave little doubt. Currently, net interest burden accounts for 1.6 percent of Gross Domestic Product (GDP) equal to 9.4 percent of federal revenue absorbing about one out of every ten U.S. dollars of federal revenue. In 2022—four years from now—it will be 2.7 percent of GDP equal to 16 percent of federal revenue absorbing one out of every six U.S dollars of federal revenue. Measured in share of total outlays, net interest will jump from 7.6 percent in 2018 to 12.2 percent in 2022 and 13 percent in 2028. This forecast though is based on very optimistic assumptions for the U..S. economy. Taking changes over the preceding couple of weeks into account, a net interest burden of 20 percent of total federal revenue looks realistic—a staggering figure with every American seeing one of every five U.S. dollars paid to the government used to finance debt.
>
> ...
> ----------------------
> http://nationalinterest.org/feature/americas-greatest-enemy-neither-china-nor-russia-its-debt-25584

"The United States pays interest on approximately $850 billion in debt held by the People's Republic of China. China, however, is currently in default on its sovereign debt held by American bondholders."

https://thehill.com/opinion/international/4075341-china-is-in-default-on-a-trillion-dollars-in-debt-to-us-bondholders-will-the-us-force-repayment/#:~:text=The%20United%20States%20pays%20interest,debt%20held%20by%20American%20bondholders.

On Friday, August 25, 2023 at 6:55:58 PM UTC-4, ltlee1 wrote:
> America's Greatest Enemy Is Neither China nor Russia (It's Debt)
>
> What looked possible some years ago have with recent economic policy decisions turned into a realistic scenario: the United States face a technical default.
>
> The figures and forecasts published by the Congressional Budget Office (CBO) leave little doubt. Currently, net interest burden accounts for 1.6 percent of Gross Domestic Product (GDP) equal to 9.4 percent of federal revenue absorbing about one out of every ten U.S. dollars of federal revenue. In 2022—four years from now—it will be 2.7 percent of GDP equal to 16 percent of federal revenue absorbing one out of every six U.S dollars of federal revenue. Measured in share of total outlays, net interest will jump from 7.6 percent in 2018 to 12.2 percent in 2022 and 13 percent in 2028. This forecast though is based on very optimistic assumptions for the U..S. economy. Taking changes over the preceding couple of weeks into account, a net interest burden of 20 percent of total federal revenue looks realistic—a staggering figure with every American seeing one of every five U.S. dollars paid to the government used to finance debt.
>
> ...
> ----------------------
> http://nationalinterest.org/feature/americas-greatest-enemy-neither-china-nor-russia-its-debt-25584

"Taking changes over the preceding couple of weeks into account, a net interest burden of
20 percent of total federal revenue looks realistic—a staggering figure with every American
seeing one of every five U.S. dollars paid to the government used to finance debt. "

https://fred.stlouisfed.org/series/A091RC1Q027SBEA
2023 Q1 Interest payment: $928.929 billion annualized
2023 Q2 Interest payment: $969.986 billion annualized

Given the 2023 budget of $5.7 trillion:
One in every six U.S. dollars paid to the government is used to finance debt now.

But the future is going to be a lot worse per Congressional Budget Office (CBO)

Interest payments on the national debt are projected to be the fastest-growing part of the federal
budget over the next three decades, according to the latest estimates from the Congressional
Budget Office (CBO).

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https://www.foxbusiness.com/economy/the-us-paying-record-amount-interest-on-national-debt

"Thanks to a combination of high inflation, rising interest rates and unrelenting growth in the
national debt, interest payments are expected to triple from nearly $475 billion in fiscal year
2022 to a stunning $1.4 trillion in 2032. "

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