The Leviticus 25 Plan – the most powerful economic acceleration plan in the world: economic scoring summary.

10.  Interest expense on projected deficits 2024-2028

Federal debt held by the public increased from $22.1 trillion in 2020 to $31.38 trillion as of Jan 19, 2023. The government also reported approximately $6.9 trillion of intra-governmental debt outstanding, which arises when one part of the government borrows from another.  This intra-governmental debt interest expense will be omitted from this calculation, since those dollars are not expensed directly.

Interest expense on the public debt during FY 2023 is projected to come in at $576 billion on approximately $31.38 trillion in debt, which calculates out as an effective 1.84% interest rate on Debt Held by the Public.

This projection does not take into account the Fed’s 2022 interest rate increases and the consequent  higher interest financing costs for new debt issuance and maturing debt rollover.  This projection also assumes a relatively stable interest rate structure and further assumes that annual federal budget deficits will be funded through Treasury Issuance as a conservative 78.0% Debt Held by the Public.

Year     Annual Deficit/2 

2023:  $964 billion/2 X .78 X .0184 = $6.918 billion

2024:  $1.056 trillion/2 X .78 X .0184 = $7.578 billion

2025:  $1.318 trillion/2 X .78 X .0184 = $9.458 billion

2026:  $1.364 trillion/2 X .78 X .0184 = $9.788 billion

2027:  $1.409 trillion/2 X .78 X .0184 = $10.110 billion

2028:  $1.725 trillion/2 X .78 X .0184 = $12.378 billion

Recapture: Total interest expense eliminated by projected operating surpluses: $49.312 billion

Source(s): Dec 2022 Average Interest Rate on U.S. Treasury Securities 1.89% https://fiscaldata.treasury.gov/

National Debt, as of Jan 19, 2023 – $31.38 trillion.  In the first quarter of this 2023 fiscal year, “gross interest on the national debt hit $210 billion—or $144 billion in net interest, excluding interest on Treasury securities held in government trust accounts. That’s $840 billion gross and $576 billion net on an annualized basis, up dramatically from $580 billion gross and $383 billion net in the 12 months before the economic shutdown in March 2020. This escalation doesn’t even reflect the full-year impact of the Fed’s 2022 interest-rate increases. Effective interest rate:  1.836% net; 2.677% gross.

Source: https://fred.stlouisfed.org/series/FYGFDPUN  |  Debt held by the public: 78%

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The Leviticus 25 Plan budget surplus (2024-2028) – Summary:

5-year projected deficit: $6.872 trillion

5-year projected recapture (subtotal):  $9.920 trillion

5-year projected interest expense savings: $49.312 billion

Budget surplus (projected) 2024-2028:

$9.920 trillion – $6.872 trillion = $3.048 trillion

Budget surplus (projected) 2024-2028 with interest expense savings:

$3.048 trillion + $49.312 billion:  $3.097 trillion

Average annual budget surplus (projected) 2024-2028:

$3.097 trillion / 5 years: $619.5 billion per year

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Note 1:  Projected budget surpluses for 2024-2028 do not factor in the additional government tax revenue gains that would accrue from the massive shift in capital away from debt service and into productive economic activity.

Note 2:  Projected budget surpluses for 2024-2028 do not factor in the additional government tax revenue gains that would accrue from significantly lower levels of debt deductibility on individual income tax filings. 

Note 3:  Projected budget surpluses from the Medicaid / CHIP recapture do not take into account the likelihood of fewer citizens actually qualifying for Medicaid / CHIP benefits.

Note 4:  The Plan’s funding of individual Medical Savings Accounts (MSAs) with the $6,000 deductible provision per year would result in an enormous drop in the number of claims each year for Medicare reimbursement. Medicare payroll taxes would generate a growing revenue stream, due to stronger economic growth, while outlays would drop significantly from the reduced claims numbers – thereby providing the Fed with a powerful tool to recapitalize the Medicare Trust Fund, vis the Citizen’s Credit Facility.

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