I wish what you say were true.
But we are very far fr9m balancing the budget, let alone decrease any outstanding debt.
$36 trillion at 10% is $3.6 trillion in interest.
$36 trillion at 5% is $1.8 trillion in interest
Or to look at it another way
Our total revenue from all sources in the fiscal year ending in 2024 was $4.92 trillion
Of that, 37% was Social Security and Medicare, or $1.82 trillion
$4.92 total revenue less $1.82 trillion in Social Security and Medicare taxes leaves $3.1 trillion in General fund revenue.
$3.1 trillion total general fund revenue divided by $36 trillion in debt is 8.6%. If interest rates hit 8.6% it takes 100% of our General Fund Revenue just to pay interest, with nothing left to run the government.
As of October 2024, the United States government has a monthly net interest rate of 3.3 percent on its debt, continuing an upward trend in interest rates that began at the beginning of 2022.
This amount or rate in net of any interest on the money borrowed from the Social Security Trust Funds.
Let’s look at this another way.
$36 trillion debt at 3.3% interest is $1.2 trillion net interest. If we have interest of $1.2 and total general fund revenue of $3.1 trillion, that leaves $1.9 trillion to run the government NOW. OUR DEFICIT LAST YEAR WAS $1.86 trillion. So we spent $1.86 plus $1.9 or $3.76 trillion in the general fund.
Elon and Ramaswami need some magic.
By the way, our government is cash basis, not accrual. They recognize expenses when paid, not when incurred.
If you look at spending in October is is obvious that the financial position is far worse than they show. They pushed a lot of expenses forward to make the deficit look smaller.
“Elon and Ramaswami need some magic.”
I’d guess we could cut our current spending in half without the average person feeling a thing, but there will be a glut of government workers to add to the unemployment lines and their severances will cut a little into the immediate savings. But a trillion cut is possible.
“Our total revenue from all sources in the fiscal year ending in 2024 was $4.92 trillion... Of that, 37% was Social Security and Medicare, or $1.82 trillion... $4.92 total revenue less $1.82 trillion in Social Security and Medicare taxes leaves $3.1 trillion in General fund revenue... $3.1 trillion total general fund revenue divided by $36 trillion in debt is 8.6%. If interest rates hit 8.6% it takes 100% of our General Fund Revenue just to pay interest, with nothing left to run the government.”
We need these cuts and to have a more efficient government going forward, but we also need policies that support growth, which Trump has proven himself to be very good at. He and Congress need a good strategy to maximize America’s prosperity based on our innovations, especially in AI and robotics.
Imagine if our GDP tripled and the current cut the government takes (17%) were cut in half. Less taxation but much more revenue. Then, balance the budget AND start paying down the debt. Or, at least don’t accrue more debt.