By Jeanne Sahadi@CNNMoneyOctober 22, 2012: 11:24 PM ET
NEW YORK (CNNMoney)
The national debt was not on the official agenda for the third and final presidential debate, which focused on foreign policy.
But both President Obama and Mitt Romney acknowledged Monday night what a chorus of former military leaders, current administration officials and fiscal hawks have been saying: that the country's debt is a threat to national security.
"A nation with our current levels of unsustainable debt ... cannot hope to sustain for very long its superiority from a military perspective, or its influence in world affairs," Admiral Michael Mullen, former chairman of the Joint Chiefs of Staff, said last month.
The concern: If the debt continues to grow unbridled, the U.S. government will be constrained in its ability to pay for what it wants to do militarily and diplomatically. And it could limit the country's leverage with foreign powers.
Especially since other countries own close to half of all outstanding U.S. public debt, with China and Japan leading the list of creditors.
"You can't be strong around the world unless you're strong at home," said Lawrence Korb, a senior fellow at the Center for American Progress who served as assistant secretary of defense under President Reagan.
Even if the bond market doesn't jack up U.S. interest rates wildly, interest costs on the country's accumulated debt could top $900 billion by 2022.
That's the equivalent of one-fourthof today's federal budget -- and about $200 billion more than the United States is currently spending on defense annually.
By 2035, interest costs could consume close to 10% of the economy unless lawmakers make policy changes, according to Congressional Budget Office estimates.
While national security spending is not the primary cause of the country's debt problem, it accounts for about a fifth of federal spending. And many defense and budget experts think the defense budget is filled with inefficiencies and waste that can be curbed without compromising national security if done smartly. (No one, for the record, thinks the $500 billion of across-the-board defense cuts scheduled to start next year are smart.)
What's more, the wars in Iraq and Afghanistan have been run on borrowed money -- more than $1 trillion so far. And the decision to run up that tab was made before the country was hit by the 2008 financial crisis, which added considerably to federal deficits.
While lawmakers in both parties agree that debt will be a national security problem, they disagree about just what role defense spending should play in deficit reduction.
Biden vs. Ryan on defense spending
That division is partly evident in the differences between the presidential candidates' defense spending proposals.
Obama has proposed spending roughly $5.8 trillion on the Pentagon's base budget over the next decade.
Under that scenario, defense would account for roughly 11% of total federal spending in 2022 -- a little below where the CBO otherwise projects it would be. Doing so would still leave the Pentagon with funding levels higher than they were under President Clinton and during the first term of President George W. Bush.
Romney has set very ambitious deficit-reduction goals -- he's aiming for a balanced budget by the end of eight years. But he has ruled out any defense cuts as part of that strategy.
In fact Romney is proposing that the Pentagon's annual base budget be at least 4% of GDP. That means that over a decade he'd spend $2 trillion more on defense than Obama, or more than $1.6 trillion relative to policies under current law.