The national debt has officially hit $35 trillion.

What is even more striking is that it reached $34 trillion just 209 days ago.

We can roll off more figures. It may be useful. If you read us, you are probably policy-savvy and have some general idea, but when we read the specific numbers our eyes popped. So here are more numbers: in 2023, the federal government spent $658 billion on net interest costs on the national debt, up by 38% from $476 billion in 2022. This was the largest amount ever spent on interest in the budget, adding up to 2.4% of GDP. Interest costs are on track to become the largest category of spending in the federal budget.

Nobody thinks we are heading back to a zero-interest rate environment any time soon.

During the 1990s the deficit and the debt were important political issues because they related to the average voter in a direct way via the mechanism of interest rates: higher deficits and debt meant higher interest rates, which made it harder to buy a house and a car, key components of the American Dream. This created at least some political incentive to budgetary soundness, even as the political incentive to increase spending and lower taxes and leave the bill to someone else in a mass democracy seems irresistible.

The Great Moderation of the 2000s, and even moreso the zero-interest rate environment of the aftermath of then financial crisis, changed all of that. Money was free!

(And, for the record, your correspondent was among those who at the time believed that we should take advantage of that free money to spend more and tax less.)

Money, it seems, will no longer be free.

Which means we may have to talk about deficits and the debt again.

This debate is depressing, because everyone who has spent 15 minutes educating themselves on the facts understands the big aggregates and understands that the unstoppable force of budget math is faced with the unbreakable obstacle of politics. Conservatives must realize that the gap cannot be bridged only by cutting spending (let alone non-defense spending). Liberals must realize that the gap cannot be bridged only by raising taxes on the rich. And everyone must realize that any realistic solution probably involves painful cuts to entitlements. Needless to say, none of the candidates currently running for national office, are prepared to admit to any of this.

We honestly have no solution to offer. No smart idea. No great grand bargain that you couldn’t think of yourself.

Like everyone else, we just watch the sand pour through the hourglass.

Policy Links

#Gender – The American Institute for Boys and Men–whose work we consistently find of high quality and interesting–has a very good report on increasing accessibility to “career and technical education” as a way to reduce the gender gap in education.

#Gender – Speaking of: As Brookings notes, “prime-age women are still driving the labor market recovery.” Over the past five years, prime-age women have driven much of the increase in the overall labor force participation rate, and prime-age women reached their highest labor force participation in recent months. In completely unrelated news, the US fertility rate is 1.6.

#Family #Housing – This isn’t directly related to gender, but it is related to family formation and therefore birth rates, so it is in the same nexus of issues: due to waning housing affordability, a growing number of Americans continue to live with their parents into adulthood. In fact, the share of young adults living with parents is now the highest since 1940, at 17%.

#Family – Lots of family policy news today… New study from the Institute from Family Studies about “marriage deserts.” As they point out, entire neighborhoods exist where children have no role models of what a thriving marriage looks like. Rebuilding the norms and networks that support marriage requires the urgent work of government, business, culture, and civil society. More.

#Reg – The Competitive Enterprise Institute has published its “Ten Thousand Commandments”, its yearly report on the state of regulation. As you can imagine, they’re not happy. Some key findings from the report: “Federal regulation’s total compliance costs and economic effects are at least $2.117 trillion annually in Ten Thousand Commandments’ estimate, and almost certainly higher,” “US households pay on average $15,788 annually in a hidden regulatory tax, which consumes 17 percent of income and 22 percent of household expenses.”

#RentControl – The great Stephen Moore weighs in on Biden’s rent control proposal. He is not a fan.

Chart of the Day

From AEI’s Tobias Peter: “IRS State Migration Data for Tax Year 2021 (most recent available). New AEI analysis shows that California, New York, and Illinois lost the most taxpayers (and their dependents) while Florida, Texas, and North Carolina attracted the most.”

Meme of the Day