US pays more in interest than national defense: David Rubenstein

What do you think about this move? Is it a big deal and will it work over time?

At the moment, it appears the market is not um responding favorably to it. It hasn't had the effect that people wanted or that the secretary wanted. Um, interestingly, Stan Druckenmiller today has an article out and he was the boss of uh Scott Besson when they were working together for George Soros and he's very critical of it. He knows much more about it than I do. Um, I'm I'm obviously as a citizen, I'm hopeful that we can lower interest rates. Uh so far, uh it hasn't worked, but maybe the Treasury will do more more things to make it work because we have as everybody now knows, 40 trillion dollars of debt, 40 trillion. And that's that now, historically, if you go back over the last, let's say three or 400 years, whenever a country paid more interest on its debt than it did for its national security, that's a sign of weakness in the country. Right now we've crossed that threshold. We're now paying more in interest every year than we are paying on our national defense. And we're paying a trillion dollars in interest, a little bit more than that now, but we pay about a trillion dollars in national defense. And as that continues, the interest goes up and the the money available for defense goes down, that tends to weaken your national security.

What's the consequences you think to markets, to the average person out there from that?

Well, the average person probably is uh focused on their day-to-day uh kind of consumer purchasing issues, but I'd say on the end, what you're going to do is you have interest rates go up, it makes it more expensive for housing, more expensive to borrow money, more expensive for credit cards. So in in the reason the president wanted to lower interest rates is obviously people are happier with lower interest rates and the economy will grow better with lower interest rates, but it's hard to get them right now. And I I would say the Federal Reserve has not yet lowered interest rates under the new chair. It may, but hasn't yet done so.