If you think about it, the Federal Government has an adjustable rate mortgage on its nearly $20 trillion debt. That can result in a pretty dramatic wallop to the budget when the fed raises interest rates even a quarter of a percentage point. That would cost a cool $50 billion—more than the entire budget of the State Department, including foreign aid.
That may not seem like a lot to a government with an annual budget of $4 trillion, but here’s what it could mean to the current administration, which has an oversized spending goal as well as an oversized reduction in programs and services.
President Trump plans to boost spending on defense and border security while cutting taxes across the board. So where will the money come from? The following programs are on the president’s cut list, totaling $7.25 billion—not nearly enough to offset the cost of rising interest rates, let alone Trump’s new budget plan.
| Program | Budget (millions of $) |
|---|---|
| Corporation for Public Broadcasting | 445 |
| National Endowment for the Arts | 150 |
| National Endowment for the Humanities | 150 |
| Minority Business Development Agency | 36 |
| Economic Development Administration | 215 |
| International Trade Administration | 521 |
| Manufacturing Extension Partnership | 142 |
| Office of Community Oriented Policing Services | 286 |
| Office of Violence Against Women | 480 |
| Legal Servies Corporation | 503 |
| Civil Rights Division of the Justice Department | 156 |
| Environment and Natural Resources Division of the Justice Department | 123 |
| UN Intergovernmental Panel on Climate Change | 10 |
| Office of Electricity Deliverability and Energy Reliability | 262 |
| Office of Energy Efficiency and Renewable Energy | 2900 |
| Office of Fossil Energy | 878 |
