America’s Debt: Past, Present, and Future

By the Editors

The following reflections on the national debt appear in the Summer 2024 issue of the Coolidge Review. Request a free copy of a future print issue of the magazine.

Neither politicians nor voters seem concerned that the national debt has recently grown by about $1 trillion every 100 days.

But on March 7, 2024, the Coolidge Foundation assembled a distinguished lineup of lawmakers, economists, historians, and policy experts for the conference “America in Debt.”

Here, leading thinkers discuss the past, present, and future of the debt.

“History is full of examples of countries and empires that dominated the world for periods of time and then failed—sometimes a slow decline, other times a sudden collapse—often due to poor fiscal policies.”

—Representative Lloyd Smucker of Pennsylvania

“The financial panic early in the Civil War morphed into a significant policy panic when federal officials struggled to find new ways to restore order to financial markets and provide a long-term means to pay for the war.”

—Dr. Michael Caires, historian

“The Panic of 1907 was the only major example of a successful crisis response led not by government but by the private sector. Yet ironically, the crisis accelerated a transition to a reliance on central planners, experts, and politicians.”

—Dr. Robert F. Bruner, coauthor, The Panic of 1907

“Not only does excessive government indebtedness pull forward into the present what would have been future growth and resourcefulness, but it almost always suboptimally allocates resources in the present.”

—David L. Bahnsen, founder, The Bahnsen Group

“As states compete among themselves to attract and retain businesses and jobs, that provides a check on state debt management.”

—James Douglas, former Vermont governor

“There’s a bizarre phenomenon in Washington in which the larger the federal debt pile grows, the less politicians seem to regard it as a problem. It’s as if they think that if they ignore it, maybe it will go away.”

—James Freeman, Wall Street Journal

“The causes of this unsustainable public debt eruption are War, Welfare, and Wampum—that is, massive, unnecessary spending for national security, a welfare state entitlements machine that is unchecked by Congress’s power of the purse, and a rogue central bank which has enabled these spending tidal waves.”

—David Stockman, former director, Office of Management and Budget

“Between the beginning of 2020 and the end of 2023, new bonds paid for 76 percent of all new spending. Tax revenues paid for about 7 percent. Money creation has paid for about 14 percent. The most recent crisis that we relied so heavily on debt and money creation was the Civil War.”

—Dr. Paul Winfree, president, Economic Policy Innovation Center

“The total debt is greater than $34 trillion, which is more than our annual GDP of about $28 trillion. And in reality, the situation is even worse than that. The $34 trillion does not include the federal government’s unfunded future liabilities, which are estimated to be nearly $80 trillion over the next seventy-five years.”

—Ambassador Richard Graber

“We need a secretary of the treasury who (a) minimizes the cost of the debt, taking advantage of the yield curve, and (b) looks creatively at how to make the tax code more efficient to maximize economic growth.”

—John W. Childs, chairman, J.W. Childs Associates

“Seeing up close how much money the government wastes was the biggest eye opener for me in my tenure as labor secretary.”

—Eugene Scalia, former secretary of labor

“If the unfunded obligations of Medicare and Social Security grow 6 or 7 percent per annum and good GDP growth is maybe 2 or 2.5 percent, the math doesn’t work. This is intergenerational theft.”

—Jeb Hensarling, former U.S. congressman

“Norms are important. And the Hamiltonian norm that served our country so well for so long, and is now frankly under assault, says that we pay our bills. What is really concerning to me is that we have a debate in Congress as to whether or not to default on our debt. Could you imagine Calvin Coolidge or Alexander Hamilton allowing that to be a discussion? It’s on us, the Congress, to figure out how to get to balance. We’ve got to pay our bills.

“I’m somebody on the liberal side who thinks that in fact we should help folks with child care, we should have health care for people who can’t afford it. But you know what? I think we’ve got to pay for it. How we get there—there’s a lot of room for debate. But there’s no room for debate, in my view, about our obligation to do what Hamilton did.”

 —Senator Peter Welch (D-VT)

“I’ve always held an abiding gratitude and admiration for President Coolidge and the principles on which he stood. During every year of his presidency from 1923 to 1929, he balanced the budget and ran a surplus, thereby cementing the nation’s reputation within international marketplaces and giving rise to unbridled growth and prosperity for every American.

“We would all do well to follow the model that he set. And while history books are not chock-full of recognition of President Coolidge, as they should be, all of us can appreciate the groundwork he laid for the nation. We can also appreciate his belief that the federal government should be kept on a short and tight leash, and that America is a land teeming with bountiful opportunity for all, just as it has been for me.

“Let’s not lose sight of the principles upon which President Coolidge stood, for they should be our principles today, and they’re worth preserving and passing along to future generations.”

—Representative Virginia Foxx (R-NC)