The United States spends about $230 billion a year in finance payments to creditors—a level that could more than double if interest rates returned to more normal levels, anti-debt crusader Erskine Bowles warned on Monday.
To put $230 billion a year in perspective, Bowles said on CNBC's "Squawk Box," it's more than the U.S. spends at the departments of Commerce, Education, Energy, Homeland Security, Interior, Justice, State and the court system combined.
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"If interest rates were to return to a median level they were in the 1990s, we'd be spending not $230 billion a year but $650 billion a year," the former co-chair of the president's debt commission said.
"When you think about it, that's $650 billion that will be spent, principally in those countries we're borrowing money from, to educate their kids, to improve their infrastructure, to do the high value-added research on their college campuses, so the next new thing is created over there," Bowles said. "That's crazy."
He also said, "You're not going to have great [economic] growth until we reform our tax code to make us more globally competitive."
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Bowles was President Bill Clinton's chief of staff from 1997 to 1998. In 2010, he was Democratic co-chair of President Barack Obama's National Commission on Fiscal Responsibility and Reform with Republican former Sen. Alan K. Simpson. Last week, he was named lead director of Morgan Stanley.