The U.S. government is now spending $88 billion every month on interest payments for its national debt, a figure that rivals combined expenditures on defense and education programs. According to a new Congressional Budget Office (CBO) report, total interest payments for the first six months of the fiscal year reached $529 billion, up 7% from the same period last year.
A Growing Burden
The surge in debt servicing costs is attributed to both the increasing size of the national debt, now at $39 trillion, and higher long-term interest rates. While short-term rates have declined slightly, they have done little to offset the overall rise in payments. For comparison, the Department of Defense’s military budget cost $461 billion over the same period, while the Department of Education spent $70 billion.
Both Congress and the president continue to ignore the urgent need to get our borrowing under control.
Deficit Concerns Persist
Despite efforts to bolster revenues, including tariffs implemented during the Trump administration, the federal deficit remains substantial. Receipts for the first half of the fiscal year totaled $2.5 trillion, an increase of $223 billion from the previous year. However, outlays also grew by $84 billion, leaving a deficit of $1.2 trillion. This marks a $140 billion improvement from last year but still projects annual borrowing exceeding $2 trillion.
Maya MacGuineas, president of the Committee for a Responsible Federal Budget, criticized the government’s fiscal management, urging lawmakers to reduce deficits from 6% to a more sustainable 3% of GDP. As the debt burden grows, the pressure mounts on policymakers to address the underlying issues driving unsustainable borrowing.