For years, weʼve watched the national debt grow, argued over spending, and used the debt ceiling as a political football. In 2024, that debt passed $36 trillion, and interest payments now rival major federal programs. But through it all, we have failed to confront the reality: this is not a blip or a temporary imbalance.
It is a structural crisis, rooted in demographic change, entitlement growth, and political dysfunction. And unless we summon the courage to speak frankly about it, the choices we leave to the next generation will be fewer, harder, and crueler. This piece is an attempt to start that conversation.
The Debt We Refuse to Face Thereʼs something profoundly unsettling about the way America approaches its national debt. We argue about it. We posture over it.
We weaponize it in campaign ads and budget showdowns. But what we rarely do — on either side of the political aisle — is face it honestly. Figure 1: U.S.
Federal Debt as a Percentage of GDP (2000–2024). Source: Congressional Budget Office, Federal Reserve Bank of St. Louis.
As of 2024, the federal government owes over $36 trillion, with the debt- to-GDP ratio standing at approximately 120% — a level not seen since World War II. Moreover, and more troubling, this time the national deficit has exploded not to support our brave soldiers fighting in World War II, but as the result of short-term expediency, political ideology, cowardice, and disgraceful corruption. As a consequence of the enormous size of the deficit interest payments on the debt now exceed what we spend on national defense and rival what we pay for Medicare.
And yet, we have no credible plan — or even a serious conversation — about what to do next. * *Some economists argue that deficits don't matter, as long as the government can print its own currency — a view known as Modern Monetary Theory (“MMT”). But MMT is a largely academic construct: it assumes rational policymakers, benign inflation, and infinite political discipline.
In a world of gridlock, short-termism, and special interests, itʼs a theory best left in faculty lounges — not used to build fiscal policy. The truth is simple, if politically toxic: this is not a temporary imbalance. It is the result of structural choices, demographic shifts, and decades of bipartisan neglect.
We are not here because of one party or one policy or one crisis. We are here because both political parties have found it easier to promise benefits than to fund them, easier to cut taxes than to explain what taxes pay for, and easier to campaign on slogans than to govern with intelligence, selflessness and foresight. How We Got Here: Promises Made, Problems Deferred The core driver?
Not waste. Not foreign aid. Not even military spending.
The answer is found in the steady, relentless growth of mandatory programs — especially Social Security, Medicare, and Medicaid — which now account for nearly two-thirds of federal spending. Figure 2: Mandatory Spending as a Share of the Federal Budget (2000– 2024). Source: Congressional Budget Office.
These programs were born from noble intentions: to provide security in old age, medical care in later life, and a safety net for the vulnerable. But they were built in a very different America — an era of higher birth rates, lower life expectancies, and more workers per retiree. Today, we face the opposite: an aging population, rising healthcare costs, and a tax base that hasnʼt kept pace.
The Healthcare Engine: Medicare and Medicaid If Social Security is a demographic time bomb, Medicare and Medicaid are fiscal accelerants. These two programs, together consuming over $1.6 trillion per year, are growing faster than the economy and faster than any other part of the federal budget — not because of fraud or waste, but because of how they're structured. Medicare, created in 1965 to provide health insurance for Americans over 65, was a revolutionary program — and remains one of the most popular in American life.
But it, too, was designed in a different era: when 65 was closer to the end of life than the middle of retirement, and when medical costs were a fraction of what they are today. The core problem with Medicare isnʼt just the number of beneficiaries — itʼs the cost of care per beneficiary. Unlike private insurers, Medicare has long had limited tools to contain costs.
Astounding as it may seem, for decades, the government was even prohibited by law from negotiating drug prices, thanks to lobbying by the pharmaceutical industry when Medicare Part D was introduced in 2003. That provision — known as the non-interference clause — made it illegal for the government to use its massive purchasing power to lower costs for seniors. * It was only partially reversed in 2022, and even then, the reforms are narrow and phased in slowly.
Corruption at work! *See: Abramson, John, M.D. “Sickening: How Big Pharma Broke American Health Care — and How We Can Repair It” (Mariner Books, New York, 2022), p.
165. This should be required reading for every American. Meanwhile, Medicaid, the health insurance program for low-income Americans, has quietly grown into a major federal and state budget item.
Originally intended as a small safety net, it has expanded dramatically — first through increased eligibility, and then through the Affordable Care Act, which extended Medicaid to millions of additional adults. Medicaid now covers over 90 million Americans — nearly one in four — and its costs continue to rise, driven by long-term care, disability services, and state-level expansions. Like Social Security, these healthcare programs are pay-as-you-go, funded largely through payroll taxes and general revenues.
But unlike Social Security, their growth is less predictable and more explosive, because it depends not only on the number of enrollees but on the trajectory of medical inflation — a force that has outpaced GDP growth for decades. The Illusion of Control If the structure of the federal budget is quietly spinning out of control, the political theater surrounding it has never been louder. Every year or two, Americans are treated to a manufactured crisis over the debt ceiling, with headlines warning of impending default and political leaders posturing as defenders of fiscal responsibility.
But these spectacles obscure a basic truth: Congress is not debating whether to spend — itʼs debating whether to pay for what it has already spent. Figure 3: Net Interest Payments on the National Debt (in $ Trillions). Source: Congressional Budget Office and Treasury Department.
Note: Interest payment projections vary depending on definitions and sources. The CBO uses the term “net interest,” though this includes nearly all federal debt service costs. Estimates from other organizations, such as the Peter G.
Peterson Foundation, may be lower depending on methodology. Regardless, interest is now among the largest — and fastest-growing — categories of federal spending. The debt ceiling, first introduced in 1917 and formalized in 1939, was originally intended to give the Treasury greater flexibility in issuing debt during wartime without requiring approval for each bond.
But over time, it has morphed into a blunt political weapon — one that allows lawmakers to posture against borrowing without actually changing the spending that necessitates it. Raising the ceiling doesnʼt authorize new expenditures; it simply allows the government to meet obligations it has already incurred. Meanwhile, the part of the budget Congress fights over each year — discretionary spending — is shrinking.
Today, only about 27% of federal spending is subject to annual appropriations. The rest is on autopilot: Social Security, Medicare, Medicaid, interest on the debt — these obligations donʼt get voted on every year. They just grow.
And yet, the national conversation remains fixated on the sliver of spending thatʼs easiest to cut: education, research, infrastructure, housing — the very investments that build the foundation for future growth. In political terms, itʼs safer to slash funding for a bridge or a lab than to touch entitlements or raise taxes. The result is a budget process thatʼs increasingly disconnected from reality — one that gives the illusion of control while the real drivers of debt compound silently in the background.
The Political Failure to Act We are not dealing with a math problem — we are dealing with a failure of political will, sustained over decades and across administrations of both parties. Democrats, historically the defenders of entitlement programs, are unwilling to broach the subject of reform — afraid, perhaps rightly, that any proposal will be twisted into accusations of “cutting benefits” or “balancing the budget on the backs of the elderly.” Republicans, for their part, talk a good game about fiscal responsibility but have repeatedly passed tax cuts with no corresponding reductions in spending, inflating the deficit while pretending to shrink it. It was under President Reagan that the modern debt trajectory began its steep ascent — driven by massive tax cuts, a military buildup, and an unwillingness to touch entitlement programs.
By the end of his presidency, the national debt had tripled, from approximately $908 billion in 1980 to over $2.6 trillion in 1988 — an increase of nearly 190%. By contrast, President Clinton, often derided by conservatives and distrusted by progressives, presided over the last federal budget surplus in living memory. Thatʼs not a partisan point — itʼs a reminder that narratives are not facts, and slogans are not policy.
Nowhere is this bipartisan abdication clearer than in the design of Medicare Part D, the prescription drug benefit passed in 2003 and mentioned above. As part of the legislation, Congress inserted a clause that prohibited the federal government from negotiating drug prices with pharmaceutical companies. It was, and remains, an extraordinary giveaway to one of the most powerful lobbying groups in Washington — a clause that prioritized industry profits over taxpayer savings, and that left the government paying more for prescription drugs than nearly any other country in the developed world.
Itʼs difficult to describe that provision as anything other than what it was: a case study in legalized influence peddling. And yet, this kind of policy design — opaque, donor-driven, and insulated from public accountability — has become a feature, not a bug, of the modern American fiscal state. Itʼs not just the refusal to act.
Itʼs the refusal to even allow a serious national conversation about what the long-term obligations of government should be, and how we intend to pay for them in a way that is fair, sustainable, and morally defensible. A Call for Action: The Debt We Owe to the Future The crisis is real. But so is our ability to confront it — if weʼre willing to tell the truth.
No one is seriously suggesting we slash Social Security or eliminate Medicare. These programs are vital. They represent a commitment to our fellow citizens and a recognition that aging should not mean abandonment.
But we need to stop pretending they can continue as currently structured without bankrupting our future. We need a plan — not for tomorrow, but for the next thirty years. One that phases in changes slowly, protects those most in need, and re-aligns our commitments with our capacity.
The same goes for taxes. We canʼt solve this through income tax hikes alone, and we shouldnʼt try. According to Jessica Riedl, one of the most respected economic policy professionals in D.C.: “If you want to know why we are facing big deficits, spending has historically been 20 percent of G.D.P., revenues have historically been 17.
Spending is going to 33 percent of G.D.P. over the next 30 years. Youʼre not going to be able to chase 33 percent of G.D.P with [taxes].” Riedl says that whatever you do to fix tax policy—and a lot needs to be done—you wonʼt get to more than 20% of G.D.P.
The truth is that broadening the tax base through smart, fair, alternative revenue sources — while protecting the vulnerable — is both possible and necessary. But it wonʼt be enough. “You need to get spending right as well.” *See Freakonomics Radio, Episode 626 “Ten Myths About the U.S.
Tax System”, March 14, 2025. No one is doing anything serious to address that issue. The current administration is looking to extend the 2017 tax cuts and to substantially increase spending on the military and border control.
“DOGE doesnʼt give any indication that itʼs a serious effort. Elon Musk and his merry band of budget cutters seem to be focusing on symbolic things like D.E.I contracts, Politico subscriptions, federal employment that serve a culture war purpose for MAGA warriors but in terms of the budget deficit, theyʼre not even a rounding error.” (1/35th of 1 percent) ** **See “Ten Myths About the U.S. Tax System.” We owe it to our children and grandchildren not just to leave them a livable planet and a peaceful world — but a country that is still able to govern itself—a country that can invest in science and infrastructure, that can respond to crises with flexibility and speed, that is not frozen by interest payments and paralyzed by debt.
That will take more than policies. It will take courage--and candor. And leadership from people willing to say what no one wants to hear.
But if we donʼt begin that conversation now, we will leave the next generation not just with our bills — but with our cowardice. And so the question becomes deeply personal: What are you going to do? What am I going to do?
If the very future of our country is at stake, then silence is complicity. Each of us has a role to play — as voters, as citizens, as stewards of the republic we claim to cherish. We can no longer afford to look away.