Annual interest payments on the national debt are set to quadruple over the next decade as a result of the budget agreement that boosted spending for the next two years, and the likelihood that Congress will elect to keep spending more even after two years.
The Committee for a Responsible Federal Budget said Thursday that under the new budget deal, the $263 billion in interest payments made in 2017 will hit $965 billion by 2018. That would be the highest amount on record.
But the group said a decision by Congress to continue spending more in 2020 and beyond would boost interest payments even higher, to $1.05 trillion.
“Under either scenario, interest will easily be the fastest growing area of the budget,” the group said.
Under current law, interest payments on the debt will increase by 267 percent over the decade, an increase that goes far beyond increases in other categories like healthcare or Social Security.
Under the group’s alternative scenario of even more spending in 2020, interest payments would rise by 301 percent after ten years.
The group projected that total national debt held by the public would rise to nearly $30 trillion by 2028 under current law, and to $33 trillion if this year’s spending boost is extended in 2020.
“The best solution to prevent interest payments from consuming the budget is to enact a comprehensive debt reduction plan,” the group said. “Absent such a plan, an ever-growing share of our budget will be financing past consumption rather than current needs and future investments.”
