The Federal Reserve just cut interest rates again, offering more relief to borrowers, excepting the world’s bigger borrower, Uncle Sam. Federal interest costs are already at record highs; they are already causing huge federal budget deficits. Yet, deficits and interest costs are poised to escalate further.

Such enormous recurring deficits are a grave concern, obviously produced by some combination of insufficient tax revenue and excessive spending. President-elect Donald Trump and the Republican Congress are almost certain to extend the 2017 Trump tax cuts which are set to expire next year. So, additional tax revenue is unlikely.

While Democrats will scare-monger about the extension and insufficient revenue, they forget that, before the cuts, the U.S. had the highest business tax rates in the developed world. U.S. companies were fleeing to foreign tax jurisdictions, not something we want to happen again. So, spending cuts have to be the main focus. We’ll get to that.

First, the problem. In the federal fiscal year just ended, net interest on the national debt reached $882 billion, surpassing Medicare and National Defense spending and trailing only Social Security ($1.4 trillion) and the catch-all category of Health (excluding Medicare) ($912 billion), according to September’s fiscal year-end Monthly Treasury Statement.

Net interest has skyrocketed from just $376 billion five years ago. It now represents 13% of total federal spending.

But wait. The Federal Reserve has begun lowering interest rates. Isn’t the problem going away? No, first because deficits are not going away; and they are enormous. They necessitate equally big annual increases in debt. In the year just ended, the deficit was $1.8 trillion. In its latest official forecast, the Congressional Budget Office projected roughly the same deficits for the current fiscal year.

If you peg the interest rate on $1.8 billion of new debt at 4.4%, roughly the current weighted average market interest rate across the maturity spectrum at which the Treasury borrows, this year’s deficit will generate about $79 billion in additional annual interest cost.

Moreover, there’s almost $28 trillion in already outstanding publicly-held national debt, most of which are long-term Treasuries issued at the super-low rates prevailing after the Great Financial Crisis and during the COVID years. Those embedded rates are far below current market rates — and prospective market rates for the foreseeable future. As outstanding Treasuries roll over, they will be replaced by newly issued Treasuries with much higher rates.

Here’s the math. As the Federal Reserve cuts rates, there will be relief as rates decrease on $6 trillion in short-term Treasury Bills maturing within one year. Two-month T-Bills are now yielding about 4.5%, down 0.75% after the Fed cut interest rate this week and in September. This translates into annual interest savings of $45 billion. The latest projection (the so-called “dot plot”) of the Federal Open Market Committee anticipates further rate cuts of 1.1% by the end of 2025. That would translate into additional annual interest savings of about $66 billion as new T-Bills replace old ones.

The rest of the almost $28 trillion of publicly held debt consists mainly of $19 trillion of long-term Treasury Notes and Bonds. According to the Treasury Department, the average interest rate on Notes and Bonds already outstanding is about 3.4%, or a full 1% below market rates for new-issue Notes and Bonds. Unless market rates for these long-term Treasuries fall, the rollover will gradually increase annual interest costs by $190 billion. Granted rollover will take years, given the long term of these securities. Alternatively, if rates fall significantly, it will take years to realize the interest savings.

So, unless rates fall significantly, the interest cost of the national debt will continue to increase, with added interest on trillions of new debt to fund recurring deficits and with the increasing cost of long-term Treasuries offsetting the declining cost of short-term T-Bills. The real kicker would come if the new tax breaks and new spending initiatives proposed in the recent presidential campaign ever took effect. Just the recurring and increasing deficits and their associated interest cost suggest that ever-increasing total federal interest costs will crowd out other federal spending. Spending cuts are almost inevitable, despite that increasing economic growth and associated increased tax revenue spurred by the extension of the Trump tax cuts will moderate the deficits somewhat.

Spending cuts are not a bad thing. Social welfare spending (Health and Income Security, apart from Medicare and Social Security) has exploded over the last five years from $1.1 trillion to $1.6 trillion, a 45% increase. In contrast, Defense spending has increased only 27% from $688 billion to $874 billion. In simple truth, if citizens were OK just five years ago with 45% less social welfare spending, they should be OK today without most of the new social welfare spending.

The one thing that is not OK is to extend tax cuts while continuing excessive spending. That’s suicide.

Red Jahncke is the founder and CEO of Connecticut-based The Townsend Group International, LLC. He is a nationally recognized columnist who writes about politics and policy.