You’ve probably seen that chart going around. U.S. interest payments hitting $1.2 trillion. Chamath and the DOGE crowd are using it to argue for deep cuts.
Let’s look closer.
Yes, interest payments have gone up. A lot. That’s what happens when the Fed hikes rates after years of borrowing at almost no cost. But context matters.
That $1.2 trillion is eye catching but incomplete. What matters is how it compares to the economy. According to the St. Louis Fed and CBPP, interest as a share of GDP was higher in the late ’80s and early ’90s. Projections put us at about 3.2% by 2026. Not ideal, but within historical range. We’ve been here before.
The CBO expects this to keep rising. That deserves attention. But it’s not the apocalypse some are making it out to be.
We can afford it. A 3 to 4 percent interest burden is manageable for a country with our economic strength. We’re not a household. We issue debt in our own currency. U.S. Treasuries remain a cornerstone of global finance.
We also have choices. Managing debt means investing in our economy. The CHIPS Act and the Inflation Reduction Act are doing that. Innovation, clean energy, manufacturing. Driving job growth and attracting private capital.
Equally important is not gutting the public workforce. Scientists at NIH. Diplomats at State. Teachers, engineers, park rangers. The people doing hard work that keeps things running. And now the same crowd is floating Social Security privatization.
Here’s the other stat getting attention: interest as a percentage of federal revenue. It’s rising, but that’s not just spending. It’s revenue. The 2017 tax law slashed government income, adding $1.9 trillion to the debt. Overall the debt rose $7.8 trillion under Trump.
Now some of the same people who pushed those policies are pointing to the debt they created to justify dismantling government. They know what they’re doing.
Even if you’re worried about debt, slashing science and diplomacy won’t fix it. It will weaken the institutions we depend on.
We need an honest conversation. One that looks at spending and revenue both. Not scary charts designed to frighten people.