Thursday, May 30, 2024

U.S. spending on interest tops national defense, Medicare

by BIZ Magazine

(The Center Square) – Congress has spent more money on interest so far this year than it has spent on both national defense and Medicare.

Spending on net interest hit $514 billion in the first seven months of fiscal year 2024. That’s more than spending on both national defense ($498 billion) and Medicare ($465 billion). Medicare is the federal health insurance program for those 65 and older and younger people with disabilities. During the same time period, the U.S. spent $873 billion on Social Security, the federal program that provides retirement, disability, survivor, and family benefits to more than 67 million Americans.

Overall spending has totaled $3.9 trillion so far this fiscal year.

“Spending on interest is also more than all the money spent this year on veterans, education, and transportation combined,” according to the Committee for a Responsible Federal Budget.

U.S. interest spending is expected to increase in the coming years. In March, the Congressional Budget Office projected “interest costs more than double in relation to GDP between 2024 and 2054, driven by rising interest rates and growing debt.”

In February, a report from the U.S Government Accountability Office found federal spending is projected to remain unsustainable in the decades to come.

“The federal government faces an unsustainable long-term fiscal path,” according to the U.S. Government Accountability Office report. “We project that debt held by the public as a share of the economy will more than double over the next 30 years and will grow faster than the economy over the long term if current revenue and spending policies are not changed.”

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