If our elected leaders are not concerned about the government deficit, should the citizens be worried?

Governments worldwide spend more than their total revenue and borrow to make up the difference.

The U.S. Debt Clock shows the US federal debt to be $21.6 trillion, averaging $177,283 per taxpayer.

The government now pays interest on $21.6 trillion. Below is a graph tracking the 10-year interest rates on US treasuries.

My brokerage website shows 10-year treasuries are currently paying 3.22%.

Since December 2016, interest rates have roughly doubled, from 1.5% to 3%. The 1.5% increase adds $324 billion in interest cost to the deficit annually and will continue to rise.

The New York Times (NYT) reports, “As Debt Rises, the Government Will Soon Spend More on Interest Than on the Military”:

“The federal government could soon pay more in interest…than it spends on the military, Medicaid or children’s programs.

The run-up in borrowing costs is a one-two punch brought on by the need to finance a fast-growing budget deficit, worsened by tax cuts and steadily rising interest rates that will make the debt more expensive.

…. But the tax cuts passed late last year have created a deeper hole, with the deficit increasing faster than expected.”

The NYT publishes select facts to push their political bias.

I wrote about Nobel Prize-winning economist Paul Krugman’s columns in the NYT. Prior to the election, anticipating a Clinton victory, he wrote, “We should probably be running bigger, not smaller deficits in the medium term.… Yes, we may face some hard choices a couple decades from now…and in any case, there aren’t any choices that must be made now.”

Less than 80 days later, after Clinton lost, he wrote “Deficits Matter Again.”

The media ignores or screams about deficits when it suits their political agenda. We’ve heard this crap for generations.

Do deficits affect us, and what can we do about it?

Nomi Prins tell us, “World’s Most Important Bank Issues Urgent “Zombie Alert”:

It’s been a decade since the world’s major central banks reacted to the financial crisis by cheapening the value of money through record low, zero or negative rates.

…. In its recent…report, the Bureau of International Settlements (BIS) warned that low rates have catalyzed an increase in the number of “zombie” firms…to an all-time high.

Zombie firms are companies “that are at least 10 years old, yet are unable to cover their debt service costs from profits.”….

…. In the late 1980s zombie firms had a 60% chance of staying in that condition the following year, the probability reached 85% in 2016.”