Interest on federal debt is set to skyrocket, potentially surpassing defense spending by as early as 2025, CNN reported Tuesday.
The federal government made $475 billion in net interest payments in the fiscal year 2022 — which ended in September — up from $352 in fiscal year 2021, according to the Treasury Department. The number exceeds the $406 billion spent on transportation and veterans’ benefits, and is on track to eclipse the roughly $750 billion spent on defense this year between 2025 to 2026, according to CNN, citing financial analytics firm Moody’s Analytics.
“Regardless of who wins the midterms or in 2024, there are really difficult decisions that will have to be made,” Dan White, an economist at Moody’s Analytics, told CNN. “This is really going to handcuff them.”