Will Interest Payments Take Up the Entire Federal Budget?

Greg Ip gave us another rendition of this old scare story in a Wall Street Journal column. The argument is that the interest paid on US government debt will soon impose an enormous burden on the federal government, choking off spending on important government programs.

The key part of this story is that interest rates will jump at some point in the not too distant future. While this is in fact what the Congressional Budget Office predicts, it is also what it has been predicting even since the...