Lincoln Chafee: “why are Federal budget deficits bad? One reason is that for every year that we run a deficit we have to borrow to pay…”

“why are Federal budget deficits bad? One reason is that for every year that we run a deficit we have to borrow to pay for the shortfall. In the beginning of our country until today, we have borrowed--this Nation of ours currently is in debt nearly $5 trillion--$5 trillion with the overwhelming majority of that having occurred in the past 15 years. The cost of servicing that debt--in other words, paying the interest on that debt--is currently $240 billion a year. That is not paying the principal. That is solely paying the interest on the debt. Interest now is the third largest payment that the U.S. Government makes every year. We pay Social Security. We pay defense. And then the next largest item is interest on the debt--$240 billion a year. Suppose we did not have to pay that interest on the debt? Suppose that $240 billion was available instead to improve our education system, or to do something about better maintenance for our highways, or to clean up our environment in a better fashion than we are currently doing, or to bolster our efforts to combat crime. A whole list of very, very attractive items would be available--potential expenditures to improve our Nation if we were not paying $240 billion a year interest on the debt. The deficit places a tremendous strain on the national economy through higher interest rates. The interest rates would be far lower. And this is not just me saying this.…”