In 1992, a slight Texan with close-cropped hair and a devilish smile terrified Republican and Democratic presidential candidates with his high polling numbers and central campaign issue: reducing the national debt.
“The debt is like a crazy aunt we keep down in the basement,” scolded the third-party candidate, Ross Perot. “All the neighbors know she’s there, but nobody wants to talk about her.”
That year, the national debt was 46 percent of America’s Gross Domestic Product. Thanks to Ross Perot – and his memorable charts showing the scale and scope of America’s fiscal problems – both Bill Clinton and George HW Bush were compelled to address an issue they’d previously ignored in the 1992 presidential campaign. In 2024, the national debt was 123 percent of the GDP, and neither major party candidate prioritized the issue. In fact, several nonpartisan analyses of their economic plans concluded that both Kamala Harris and Donald Trump would make the situation much worse. Neither candidate seemed to grasp that we are playing Russian roulette with the economy by not addressing the debt.
The numbers tell a sobering story. Our government’s debt as a share of our economy is bigger than at any time since World War II. In the 1940s, Washington had to spend whatever it took to win the war, but we knew that high level of spending would one day end.
On the other hand, America’s current budget imbalance has no end in sight.
From its founding in 1787 until 2008, America accumulated $10 trillion in debt. In the 16 years since, we have accumulated another $25 trillion. The national debt is now growing at $6.6 billion daily.
But it is not just the size of the debt that should trouble us. Government is increasingly spending on short-term consumption and income transfers rather than expenditures on seeds for future growth, such as investments in infrastructure, education, and scientific research into new cures for cancer or solutions to climate change. In the 1960s, investment accounted for about 30 percent of federal spending; 2019 before the COVID-19 pandemic, it was about 12 percent.
For more than a decade, this has all been tempered by historically low interest rates.
But those days are over, and the bill is coming due. In 2024, Washington spent nearly $900 billion on debt interest payments alone, an increase of more than 80% since 2022. In 2025, total payments are anticipated to be more than $1 trillion. For the first time in history, the federal government is spending more on debt interest than on defense.
In the current political environment, can anyone lead the public to solutions that might mean higher taxes and a modification of popular programs? I believe it is possible—if our leaders dare to actually lead.
However, the early evidence is not promising. Although President-elect Trump has promised significant spending cuts through his new Department of Government Efficiency (DOGE), he has notably said he won’t touch Medicare or Social Security, the primary drivers of our growing debt. Whatever reforms DOGE does suggest will no doubt be challenging to implement because, as Ronald Reagan said in his final press conference as president, “the first rule of bureaucracy is protect the bureaucracy.” Meanwhile, Congress recently passed, and President Biden signed, a bill to provide additional Social Security benefits to public employees. Whatever your view of this reform, it wasn’t paid for and will cost about $200 billion over 10 years.
In 2034, the Social Security Trust Fund will no longer be able to pay the full promised benefits due to three demographic trends: First, the number of recipients is skyrocketing. Second, Americans are living longer and, therefore, collecting benefits much longer. The third and closely related trend is the diminishing share of workers available to finance the retirement benefits of a massive Baby Boom generation. In 1950, 16.5 workers were paying into Social Security for every one person drawing benefits. By 2035, there will only be 2.1 workers for every recipient.
By the way, there is no rational reason in dire times like these why people like me who don’t need Social Security should be receiving monthly checks from the federal government. President Franklin Roosevelt said it intended to “give some measure of protection to the average citizen and to his family against the loss of a job and against poverty-ridden old age.” Giving Social Security benefits to everyone also supports many fortunate recipients in recreational pursuits. I didn’t see anything in FDR’s speech about paying a retiree’s greens fees.
Medicare remains a significant concern. The government estimates that the Medicare Trust Fund will only be solvent until 2036.
In the last few decades, presidents and Congress have repeatedly passed laws they knew would be more expensive than advertised. President George W. Bush created Medicare Advantage, a vast new pharmaceutical benefit, without a real new source of funding by gaming the Congressional Budget Office scoring process. President Obama did the same thing to pass the Affordable Care Act in 2010. And President Trump did it again to pass his 2017 tax bill.
A bipartisan fiscal commission could be crucial in addressing the United States’ national debt problem by providing a structured, collaborative approach to developing solutions. Such a commission might be the only way to force Congress to act. Commissioners can engage in open and frank discussions without fear of political reprisal, allowing for more honest and productive conversations without grandstanding.
While they are at it, Congress should pair the creation of a fiscal commission with legislation to eliminate the debt ceiling. The debt ceiling does nothing to constrain the debt and regularly jeopardizes the creditworthiness of The United States. Most distastefully, its existence allows the members of the minority party to periodically act out a surreal pantomime of political leaders senselessly incinerating the nation’s credit rating. This is one kabuki dance we can do without.
The Fiscal Stability Act, introduced by now former Senators Joe Manchin (D-WV) and Mitt Romney (R-UT) in the last session of Congress, aimed to create a 16-member bipartisan commission, including outside experts, to address the national debt. A similar commission, led by Alan Greenspan in the 1980s, successfully introduced Social Security reforms in that decade. The Simpson-Bowles Commission in 2010 recommended thoughtful fiscal reforms, but President Obama – who had signed the legislation that created the commission – and Congress essentially ignored consideration of their work.
It’s time for our leaders in Washington to do what Ross Perot did three decades ago. He understood that leading does not mean taking the easiest path to soothing the public. He knew that leading meant telling the voters what they needed to know.
Cynics will argue that solving the debt crisis is a bridge too far in these troubled and polarized times. But a time of immense political change and realignment is when we can achieve what seems impossible. After all, it was the Depression of the 1930s that made the New Deal possible. The stagflation of the 1970s opened the way for the Reagan Revolution. These coming months and years could be Washington’s last, best hope of getting its act together before a fiscal crisis forces harsh solutions no one will like.