U.S. National Finances Pushed to Brink of Bankruptcy

Roman Emperor Julius Caesar was assassinated on March 15, 44 BC. There was reason to be wary of mid-March this year, 2,070 years later. Though it received little attention, this moment marked another critical juncture in the nation's accelerating self-destruction.

The Peterson Foundation recently projected that U.S. national debt will reach $39 trillion. This forecast comes less than five months after the debt surpassed $38 trillion. If current fiscal mismanagement continues, the nation may pass the $1 trillion milestone in additional debt three times within a single fiscal year.

The Congressional Budget Office expects the government will need to spend more than $2 trillion annually on debt servicing alone within the next decade.

The fastest-growing age group is those 65 and older. They vote at high rates because greater government benefits mean greater political stakes. Politicians, aware of their strong voting motivation, seek to strengthen elderly welfare benefits.

Last year, President Donald Trump's "One Big Beautiful Bill Act" increased the standard tax deduction for seniors—a benefit exclusively for the elderly.

In the context of rapidly advancing medicine and a welfare state, extending lifespans across society could prove catastrophic. Longer lifespans are also regressive, representing massive annual wealth transfers from working employees to retirees. Retirees, who have accumulated wealth throughout their lives, are generally wealthier than the young workers supporting them.

Russ Greene of the Primemover Research Institute defines the problem as "the luxurious communism of the baby boomers." In his essay for "The American Mind," he identified the baby boom generation—born between 1946 and 1964—as the primary cause of deteriorating national finances.

Greene believes today's political polarization is exaggerated given basic budget arithmetic. The reason lies in how the national budget is structured. About 75% of the total budget is automatically disbursed by law, including Social Security and interest payments on national debt. The two parties end up fighting bitterly over roughly 15% of the total budget.

This explains why cultural issues—such as biological males participating in women's sports—have become prominent in today's politics. Income distribution conflicts, once central to politics, are no longer as prominent. The welfare state that Greene calls the "retirement state" already controls a vast share of social capital.

Greene hopes for "more generational conflict"—long predicted but yet to materialize—noting that "baby boomers are organized, while broader political awakening has not occurred among younger generations."

Consequently, baby boomers live comfortably without feeling much threat, even as some households receive nearly $117,000 annually in Social Security benefits and certain healthcare programs cover golf balls, green fees, social clubs, skiing, and horseback riding.

Thomas Jefferson called spending money that descendants must repay "a massive fraud that cheats the future." However, borrowing from the future to fund public goods benefiting all citizens, present and future, is not inherently unjust. Such public goods—physical (roads, dams, ports, defense) and intellectual (education, scientific research)—form the infrastructure enabling society's dynamism.

The deceptive practice now considered normal occurs when those in power fund their public service consumption by burdening future generations. This practice accumulates risk. The higher the national debt-to-GDP ratio, the less room the government has to respond to recessions or other economic shocks.

According to the Committee for a Responsible Federal Budget, national debt stood at 35% and 80% of GDP during the last two recessions, respectively. The current ratio is 100%.

If we have completely eliminated the business cycle, there is no cause for concern. But if not, the situation is grave. As physicist Richard Feynman noted, "The first principle is that you must not fool yourself—and you are the easiest person to fool."