National debt: A pop quiz

By Rich Barbieri, deputy managing editor


NEW YORK (CNNMoney) -- Pop quiz: What's the fastest-growing portion of the federal budget this year?

There are a number of good candidates. Maybe it's Social Security. We know the baby boomers are retiring. Is it defense? The Pentagon is fighting wars in Afghanistan and Iraq, after all.

Maybe it's the ongoing cost of those bailouts that Congress passed more than two years ago.

OK, suspense over. It's the interest on the national debt, according to the Congressional Budget Office.

Every month, CBO prepares a two-page balance sheet that summarizes what the government is spending and taking in. The latest version, released Monday, reports that Uncle Sam has paid $80 billion in net interest on the federal debt through the first four months of the 2011 fiscal year.

That represents a 9.1% increase over the same period last year.

The four-month period offers just a snapshot of the year. And the CBO report distills the gigantic federal budget, with its thousands of different programs, into nine big categories.

But make no mistake: The interest on the debt is a growing chunk of the budget. Last fiscal year, interest costs rose 13.2% -- more than any other category.

CBO, in its typically understated fashion, chalks up the current year's increase to "the substantial growth in the national debt over the past year."

The debt total recently hit the $14 trillion mark. And over the next 10 years, the CBO projects that interest costs will skyrocket because of anticipated higher rates and the issuance of new debt.

The government has been forced to borrow a lot because of the persistently wide gap between spending and revenue.

This week alone, the Treasury Department plans to issue $191 billion in debt to investors at home and abroad. And in fiscal 2011, the federal government is expected to have its third consecutive annual deficit exceeding $1 trillion. To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Index Last Change % Change
Dow 17,001.22 -38.27 -0.22%
Nasdaq 4,538.55 6.45 0.14%
S&P 500 1,988.40 -3.97 -0.20%
Treasuries 2.40 -0.00 -0.17%
Data as of 10:06am ET
Company Price Change % Change
Bank of America Corp... 16.13 -0.03 -0.19%
Apple Inc 101.32 0.74 0.74%
Salesforce.com Inc 59.80 4.09 7.34%
General Electric Co 26.15 -0.28 -1.06%
Cisco Systems Inc 24.65 -0.24 -0.96%
Data as of Aug 22

Sections

The Coolest Cooler launched a Kickstarter campaign in July and has raised over $9 million so far, the second highest grossing campaign ever. More

The Coolest Cooler launched a Kickstarter campaign in July and has raised over $9 million so far, the second highest grossing campaign ever. More

This month, Delaware became the first state to pass a law giving heirs the right to access the online accounts and assets of someone who has passed away. More

Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.