During a hearing focused on the nation’s fiscal health, Senate Budget Committee Chairman Mike Enzi (R-WY) today said that Congress must take concrete steps toward a sustainable fiscal future before it is too late. The Committee heard from Gene L. Dodaro, the Comptroller General of the United States and head of the U.S. Government Accountability Office (GAO), on the agency’s annual update on the fiscal health of the nation.
“As the deficit grows and we borrow even more money to fund the government, GAO predicts the interest payments on the money we borrow will overtake all other spending,” said Chairman Enzi. “This should be a major red flag for everyone. As the Comptroller General noted in the hearing, the annual interest payments on our debt exceed what we spend on agriculture, transportation, and veterans’ benefits and services combined.”
Enzi said while GAO has previously warned that the federal government is on an unsustainable fiscal path, the budget outlook has grown even more dismal since last year’s report thanks to legislation enacted in 2019. Last year GAO projected that debt as a percentage of gross domestic product, which compares the size of our debt to the size of our economy, would surpass its historical all-time high of 106 percent by 2038. Now GAO projects we will hit that grim milestone by 2034 if current laws don’t change. By 2041, GAO projects our annual interest payments will be more than what we spend on Medicare. By 2044, interest payments will exceed what we spend on Social Security. By 2049, interest payments will exceed total discretionary spending.
“We can and do have spirited debates on what our spending priorities should be, but interest payments on our debt are not debatable,” Chairman Enzi said. “If we stay on the path we are on today, net interest will become the largest category of federal spending. We do not get to decide whether we want to spend that money on healthcare or defense or retirement security. It is already committed. It is my sincere hope that we can take concrete steps towards a sustainable fiscal future. A return to sensible budgeting would be a good start, but we must act before it’s too late.”