The United States professes to be the richest, most successful, best economy, in the world and in history. By my Grandpa’s reasoning, that is baloney. With all taxes, we bring in bring in ~300 trillion a year, and we spend ~600 trillion dollars. We handle that problem by borrowing. That is the simple answer to why the national debt keeps going up. We never pay down on the principal; We the People pay no attention to what the president, the legislature, and the treasury department, are doing; and the national debt is some sort of mystery. We seem to think of such sums as being in Monopoly Money, some sort of fantasy. We bemoan the interest payments on our mortgages: tens of thousands of dollars perhaps; but we ignore the fact that our government uses our money to pay ~$2.5 billion in interest a day. The Treasury Department paid a record $213 billion in interest payments on the national debt in the last quarter of 2022, up $63 billion from the same period a year earlier.

The fourth-quarter tab was also nearly $30 billion more than in the prior quarter, which is the largest quarterly increase on record, said Jerry Dwyer, an economics professor emeritus at Clemson University. That is only to pay on the government’s arbitrary debt ceiling of $31.4 trillion. That is because–as the existing debt matures–the government issues new debt with the higher prevailing interest rates.

The higher rates will very likely increase the net interest cost on the national debt to about $9 trillion over the next decade; and every year, that estimate goes up with no end in sight, short of a world-wide economic catastrophe occasioned by America defaulting on its stratospherically high interest payments with consequent plummeting of the value of the US dollar, the presumed security of the US economy as a safe investment, and the attendant loss of influence and power.

As of 2020, the interest on national debt was $479 billion; and then, the interest rate on federal debt was a record-low 1.605% in fiscal 2021. It ticked up to 2.07% in the following year. The US has started paying more to borrow due to the Fed raising its policy rate to try to cool off the economy. Net interest payments on the debt are estimated to total $395.5 billion this fiscal year, or 6.8% of all federal outlays. As of April 30, 2023, the Treasury of the United States paid for accrued interest outstanding expense with Treasury Floating Rate Notes, $2,519,359,437.91 per day.

By 2032, interest costs will triple [a 35% increase] to more than $3 billion per day and to at least $9,400 per household, on average, according to the Peter G. Peterson Foundation, a nonpartisan organization that seeks to raise awareness of America’s long-term fiscal challenges. Those costs are on track to become the largest federal budget item, surpassing Social Security and Medicare by the middle of the century. Over the current 10-year period from 2023 to 2032, interest costs of 3.3% are predicted to total $8.1 trillion. No one would be surprised to see even higher increases in interest rates.

Of that amount, about $24.5 trillion, or 78 percent, was debt held by the public–representing cash borrowed from domestic and foreign investors. The remaining $7.0 trillion [22 percent], was intragovernmental debt, which records transactions between one part of the federal government and another. Consider for a moment the amounts of money denoted in the amounts appearing after the decimal point. They are $91 million/day, and by 1932, an increase of $500 billion which is $500 million million. I could not fit the national debt in my house in carefully stacked $100 bills.

Speaking of foreign investors; the ranking of countries to whom the US owes money is:

  • The United States owes itself about $12.9 Trillion USD as of February, 2016.
  • China has about $1.25 Trillion USD in US Treasuries as of February, 2016.
  • Japan ($1.13 Trillion USD)
  • Ireland ($256 Billion USD)
  • Brazil ($247 Billion USD)

More than a third of the debt is owned by foreign countries (34.4%). The largest foreign holders of US debt are Mainland China (7.2%) and Japan (7.0%). The percentage of debt owned by countries that are less friendly to America is about 10%. This includes China, several oil exporters [Ecuador, Venezuela, Iran, Iraq, Libya], and a few others. The worst case would materialize if the largest holders decided to sell their Treasury securities at the same time. This would be highly likely to decrease demand, which would push yields higher. If yields rise, the federal government will find it more difficult to service the debt, pushing the deficit higher. Still, at this point–given the state of the global markets–the US is still considered to be the best house in a bad neighborhood.

The current surge is due mainly to the Federal Reserve raising interest rates by 4.25% between March and December. The central bank increased the rate another quarter point in February. Having rapidly growing interest makes it much more difficult for government to fund all the things that are important to our society; maybe then, We the People will wake up and face the challenge–the barbarians at the gates we have so foolishly invited in.

We are a rich nation filled with intelligent and enough well-informed leaders to work out a solution for this family financial problem grown almost impossibly large. In the next issue, we will look at the real nonpolitical and the seemingly eternal political issues surrounding such a venture—one on a par with what was required in World War II.


I chose to use a pseudonym for personal reasons. I’m a retired neurosurgeon living in a rural paradise and am at rest from the turbulent life of my profession. I lived in an era when resident trainees worked 120 hours a week–a form of bondage no longer permitted by law. I served as a Navy Seabee general surgeon during the unpleasantness in Viet Nam, and spent the remainder of my ten-year service as a neurosurgeon in a major naval regional medical center. I’ve lived in every section of the country, saw all the inhumanity of man to man, practiced in private settings large and small, the military, academia, and as a medical humanitarian in the Third World.