Kevin Williamson, writing in the National Review Online, is not optimistic about our 2023 national debt, projecting our interest costs on the assumption that interest rates won’t rise over the next 10 years (OK, he’s pessimistic; he holds rates at their current near-zero levels only to make a point).

Williamson projected the interest payments on the $26 trillion debt projected for 2023 to be $763 billion at today’s rates.  That works out to an interest rate of 2.9%.  Those $763 billion would be more than what the Federal government spent on Social Security, national defense, or all nondefense discretionary spending in 2011, Williamson noted.

But suppose interest rates rise as lenders decide our sovereign debt just isn’t all that valuable, our ability to repay that debt just isn’t all that assured?

First a rounding exercise: let’s say our interest rates rise to 3%.  That runs our 2023 interest payment to $780 billion.  That’s not so bad, eh?  However, nearby historical treasury rates, dating back 1990, have run around 5%.  That runs the interest bill to $1,300 billion.  If rates run to 7%, where they were during the Vietnam War, the interest bill gets over $1,800 billion.  If it spikes to 14%–the Carter Recession—the interest bill explodes: $3,600 billion. That’s what the Federal government spent—on everything—in 2012.

Who wants to bet lender confidence levels in our debt will keep our interest rates from rising above that historical average?