I cannot speak for the president but perhaps he said excluding interest on the debt because that is the only part of the budget you cannot negotiate on or cut (aside from paying off the debt or adding to it). As a percent of the budget, interest on the debt is not 20%. Using the figures you provided which show $343 billion in interest for the 2012 fiscal year, that is out of a budget of nearly $3.8 trillion http://en.wikipedia.org/wiki/2012_Un...federal_budget or under ten percent (closer to nine). BUt you are correct that the amount will continue to go up unless the debt goes down and in all likelyhood the interest rates on the debt will rise in the future from their current historic lows so the percent of the budget eaten up by the debt will get bigger and bigger in the future.It's my understanding that it's more like 20% that goes toward servicing the interest on the national debt. From the GPO (.PDF file):
According to Obama (from that same report, emphasis mine):
Originally Posted by President Obama
That is why, working with the Congress, we will establish a bipartisan fiscal commission charged with identifying additional policies to put our country on a fiscally sustainable path—balancing the Budget, excluding interest payments on the debt, by 2015.
Why do you suppose that President Obama explicitly excluded interest on the debt as a budget consideration? Is it because "deficits don't matter", or could it be that it's just too staggering to even think about?
As for his quote- I don't see even the remotest chance of a balanced budget by 2013 in the first place. The required cuts and tax increases (you can't do it simply via one or the other though mathematically you could via tax increases alone- that would mean doubling the income tax and if only by cuts you would have to get rid of the equivelent of everything outside Social Security/ Medicare, and interest on the debt) necessary to achive that are too great.