Government

Let’s be clear about the national debt

Here are the figures from the Treasury website. Note the difference between 1-20-09 and 2016.  That intergovernmental debt is the value of bonds held by the Social Security Trust Fund and other government trusts, but mostly Social Security. So when you hear about the deficit being reduced that’s true, but we are still adding to the debt every day.  As interest rates rise the money we spend to service this debt will increase. 

Now you see the facts. 

 
  

Advertisements

4 replies »

  1. “Much of that interest payment was used to pay current Social Security benefits”.

    Not true. Since SS trust fund is only 28% of the total debt, much more of the interest went to retirement accounts and governments holding U.S. Bonds.

    The problem with the trust fund is not the interest going to pay for benefits, it is the trust fund being drawn down to zero over the next 18 years.

    We need to raise the payroll tax, to keep it more in line with what people receive in benefits.
    We need to raise the cap on income taxed for SS.
    We need to slow the increase in future benefits.
    If we do a combination of all 3 problem solved.

    But, I am not sure our Congress or President will act in time.
    The result, just cut everyone’s benefit by 30% in 2033.
    Then anyone living under the poverty level can go apply for other government programs they then will qualify to receive.
    We are going to pay for the shortage in the SS account one way or another.

    Like

    • You misunderstood. I was talking about the intergovernmental debt which is mostly Social Security. The interest paid to other governments is not in that account.

      Like

  2. In 2015, the U.S. spent $218 billion, or 6 percent of the federal budget, paying for interest on the debt. In recent years, interest rates have been at historic lows. As they return closer to normal levels, the amount the government spends on interest will rise substantially.

    Much of that interest payment was used to pay current Social Security benefits.

    Like

What's your opinion on this post? Readers would like your point of view.

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s