How easy is it to halve a deficit?

President Obama’s budget outline to Congress has to do a lot of things at once—begin to build some of the major investments he spoke about on Tuesday, in energy, education, and health care; account for the middle-class tax relief he has pledged for so long; and deal with the near-term fixes in the housing and banking sectors. But one pledge is growing in salience, due both to public concern around rising debt levels and thanks to the White House’s quick, expectations-increasing “fiscal responsibility summit” on Monday: reducing the deficit in half by the end of the first term. Great, but how do you cut the deficit, anyway?

It’s neither as effortless as fiscal hawks would have it, nor as inconsequential as the permanent Keynesians want it. The Congressional Budget Office (CBO) estimates the 2008-09 deficit will run to $1.2 trillion, or 8.3 percent of the nation’s entire GDP (and you can add another $185 billion to that once you throw in the cost of the fiscal stimulus this year)—numbers big enough to require dramatic action and to sink the country’s finances if unaddressed. But not every federal dollar taken in or spent has the same stature. Think of the budget, and therefore the budget deficit, not as a big beast that needs to be slain, but as a pop song with multiple tracks.

The first track is the relentless drumbeat of net interest on debt. Unless the government defaults on its debt—presumably an instant path to a world financial crisis—there’s absolutely no discretion here. So this can’t be cut in any meaningful sense, although, in times of plenty, more debt can be paid off. Like an unpleasant echo, the excesses of the past mean greater interest payments in the future, and net interest on debt often lags the budget deficits that created them. Net interest on debt reached as high as 15.4 percent of federal spending in 1996 and stood at only 8.6 percent of spending in 2007. But the CBO predicts the total interest payments will go up to $358 billion by 2013, around 10 percent of federal spending. Meanwhile, the CBO expects our overall public debt to increase to $9 trillion by 2019, and that’s before new spending and lending initiatives the administration might undertake that would eventually create a need to service yet more debt.