POLICY PAPER: The Debt Tax

The United States federal government paid $332.5 billion in interest last year on the national debt. This payment, equal to 11% of the total federal budget, does not build roads, nor does it provide education, subsidize housing, or create any other service. It merely services the $6.6 trillion (and growing) national debt. These interest costs are equivalent to a "Debt Tax" - a tax that drains income but does not produce any corresponding service benefit for today's taxpayers.