{"id":821,"date":"2012-08-29T16:12:00","date_gmt":"2012-08-29T16:12:00","guid":{"rendered":""},"modified":"2018-01-27T14:46:01","modified_gmt":"2018-01-27T21:46:01","slug":"interest-not-debt-matters","status":"publish","type":"post","link":"https:\/\/franklycurious.com\/wp\/2012\/08\/29\/interest-not-debt-matters\/","title":{"rendered":"Interest Not Debt Matters"},"content":{"rendered":"<p>In reference to the wonderful <a href=\"http:\/\/franklycurious.com\/index.php?itemid=2046\">debt graph that Ezra Klein presented<\/a> yesterday, <a href=\"http:\/\/www.cepr.net\/index.php\/blogs\/beat-the-press\/the-graph-you-really-need-when-watching-the-republican-and-democratic-conventions\">Dean Baker presents an even better graph<\/a>. This one is not on debt, because as Baker notes, the issue is not debt; it is interest on the debt. He notes sarcastically, &#8220;We don&#8217;t get back to the same devastating interest burdens we faced in the early 90s until 2019&#8221;:<\/p>\n<div class=\"center\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/franklycurious.com\/media\/1\/20120829-interest-as-gdp.jpg\" width=\"467\" height=\"279\" alt=\"Interest on Debt as Percentage of GDP\" title=\"Interest on Debt as Percentage of GDP\" \/><\/div>\n<div class=\"box\">Am I pulling a fast one here by switching from debt to interest payments? Not at all. Suppose we issue $4 trillion in 30-year bonds in 2012 at 2.75 percent interest (roughly the going yield). Suppose the economy recovers, as CBO predicts, and the interest rate is up around 6.0 percent in 4-5 years. The federal government would be able to buy back the $4 trillion in bonds it had issued for roughly $2 trillion, immediately eliminating $2 trillion of its debt. This will make those who fixate on the debt hysterically happy, but will not affect the government&#8217;s finances in the least. It will still face the same interest obligation.<\/p>\n<p class=\"lastbox\"The point here is that the fixation on the debt by both parties has paralyzed economic policy so that tens of millions of people are now being needlessly forced to suffer the effects of unemployment. We need graphs that focus on the economy, not silliness that distracts from real issues in order to assign partisan blame. (Yes, the Bush tax cuts were stupid and the wars should not have been fought, but they did not get us in this mess.)<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>In reference to the wonderful debt graph that Ezra Klein presented yesterday, Dean Baker presents an even better graph. This one is not on debt, because as Baker notes, the issue is not debt; it is interest on the debt. &hellip; <a href=\"https:\/\/franklycurious.com\/wp\/2012\/08\/29\/interest-not-debt-matters\/\">Continue reading <span class=\"meta-nav\">&rarr;<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"class_list":["post-821","post","type-post","status-publish","format-standard","hentry","category-politics"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.1 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Interest Not Debt Matters at Frankly Curious<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/franklycurious.com\/wp\/2012\/08\/29\/interest-not-debt-matters\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Interest Not Debt Matters at Frankly Curious\" \/>\n<meta property=\"og:description\" content=\"In reference to the wonderful debt graph that Ezra Klein presented yesterday, Dean Baker presents an even better graph. This one is not on debt, because as Baker notes, the issue is not debt; it is interest on the debt. &hellip; Continue reading &rarr;\" \/>\n<meta property=\"og:url\" content=\"https:\/\/franklycurious.com\/wp\/2012\/08\/29\/interest-not-debt-matters\/\" \/>\n<meta property=\"og:site_name\" content=\"Frankly Curious\" \/>\n<meta property=\"article:published_time\" content=\"2012-08-29T16:12:00+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2018-01-27T21:46:01+00:00\" \/>\n<meta property=\"og:image\" content=\"http:\/\/franklycurious.com\/media\/1\/20120829-interest-as-gdp.jpg\" \/>\n<meta name=\"author\" content=\"Frank Moraes\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@CuriousFrankly\" \/>\n<meta name=\"twitter:site\" content=\"@CuriousFrankly\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Frank Moraes\" \/>\n\t<meta name=\"twitter:label2\" 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