Wednesday, January 26, 2011

Muddled Debt Math

I keep thinking about the ways folks understand numbers and the basic math behind them. The interest on the federal debt in 2010 totaled $413 billion! None of the proposals being floated presently (even the most aggressive by our own Sen Demint)come anywhere close to that figure. During the last 3 months alone the interest has been $197billion. Remember, the costs are at historically low interest levels. If the rates rise to "normal " levels, the interest charges rise exponentially. To actually "cut" spending enough to reduce the deficit you likely need more than a half TRILLION a year reduction in spending. Not sure anyone has that in mind.