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far the most popular: allowing homeowners to deduct mortgage interest payments and excluding employer-paid health insurance premiums from workers’ taxable income.
    For every dollar the U.S. government spent in 2011, it borrowed 36 cents, much of it from China, where the income per person is about one-sixth of that in the United States.
    Except for four unusual years at the end of the 1990s and the beginning of the 2000s, the federal government has spent more than it took in every year for the past four decades. It borrows the difference, essentially promising that taxpayers in the future will pick up the tab for government spending today. The U.S. government is by far the world’s biggest borrower even though the United States is by far the world’s biggest and richest economy, a historical anomaly. By any yardstick, its borrowing in recent years has been huge. Part of this wasautomatic: when people are out of work, they pay less in taxes, and government spending on unemployment benefits and food stamps goes up because more people qualify. Part of this was deliberate policy: Congress increased spending and cut taxes.
    The bottom line is that theU.S. government borrowed $3.6 billion a day in 2011, holidays and weekends included, or about $11,500 for every man, woman, and child in the country. About half of that borrowing
came from overseas.
The net interest tab on the government debt was about $230 billion last year, which exceeded the budgets of the departments of Commerce, Education, Energy, Homeland Security, Interior, Justice, and State, plus the federal courts,
combined
. As deficits persist and interest rates rise from recent very low levels, as they inevitably will, interest payments will claim an increasing slice of the federal budget, crowding out spending on other things.
    Today’s budget deficit is not an economic problem—tomorrow’s is.
    For all the dire rhetoric about the dangers of debt, all the scares about the United States becoming another (albeit far larger) Greece, big U.S. government deficits have not been an economic problem—at least not yet.
    The deficits have been big. Measured against the value of all the goods and services produced in the United States, known as the gross domestic product (GDP), deficits in theRonald Reagan years peaked at 6 percent. In the past three years, they came in at 10 percent of GDP in 2009 (the fiscal year that spans the end of the George W. Bush presidency and the beginning of Barack Obama’s) and at 9 percent and 8.7 percent in the two subsequent years.
    Running bigger deficits in a deep recession and sluggish recovery is still Economics 101—even if one can get a good debate going among serious people about how best to do that and how well the medicine works. Running
deficits
means the government has to borrow the difference between income and outgo. The sum of all that borrowing is the government
debt
. Borrowing by government, banks, business, and consumers soared so much during the 2000s that at the end of 2008 the U.S. economy as a whole owed twice as much as it did in 1975, measured against the size of the economy. Since then, private borrowing has come down, but government borrowing has gone up—a lot—in a deliberate effort to cushion the economy from the pain caused when so many lenders pull back and so many borrowers try to pay off loans or walk away from them.
    Despite the anxiety about the capacity of a paralyzed political system to grapple with deficits projected for the future—and despite the headline-making move by ratings agency Standard & Poor’s to strip the U.S. Treasury of the prized AAA credit rating that signifies the safest risks—savers, investors, and governments around the world still view U.S. Treasury bonds as the most secure place to put their money. For now. The only other big government bond markets—Europe and Japan—are inplaces that have big problems of their own, which makes the United States the world’s tallest