Klaus Marre 08/20/26 (WhoWhatWhy.org)
It’s been a century since an administration decreased the national debt.
When Ronald Reagan took office in 1981, the national debt had not yet reached $1 trillion. However, in his inaugural address, the new president recognized the looming danger that it posed.
“For decades we have piled deficit upon deficit, mortgaging our future and our children’s future for the temporary convenience of the present,” he said. “To continue this long trend is to guarantee tremendous social, cultural, political, and economic upheavals.”
Reagan added that it is possible for individuals to live beyond their means by borrowing money, but that this only works for a limited amount of time.
“Why, then, should we think that collectively, as a nation, we’re not bound by that same limitation?” Reagan said. “We must act today in order to preserve tomorrow. And let there be no misunderstanding: We are going to begin to act, beginning today.”
And act he did. By the end of his two terms in office, the debt had nearly tripled to almost $3 trillion.
Fast forward to 2016, when the debt was $19 trillion. At that time, presidential candidate Donald Trump echoed Reagan and also warned that “we are mortgaging our future [and] we are mortgaging our children’s future.”
Fortunately for America, he went on to explain that he “went to Wharton” and understood the debt, and that the country would “pay it back so easily” once he created a dynamic economy (it’s worth watching the clip just to hear Bill O’Reilly sigh 6:57 into this interview).
Well, that didn’t happen. In just 10 years, the debt doubled again and reached $40 trillion on Wednesday.
And it keeps piling up.
For example, even though the “One Big Beautiful Bill” cut $1 trillion from social programs like Medicaid and the Supplemental Nutrition Assistance Program by taking healthcare and food stamps away from millions of Americans, this one piece of legislation will add $3.4 trillion to the debt over the next decade — about five times as much as the nation had racked up through the first 200 years of its existence.
That number pales in comparison to the interest the country has to pay to the people and governments to which it owes money. This year, that figure will surpass $1 trillion for the first time. And, over the next decade, interest payments are expected to total $16.2 trillion.
Of course, one has to take into account inflation, which is why it is worth comparing the debt to the nation’s gross domestic product (GDP).
When Reagan took office, it amounted to a bit over 30 percent of GDP. Now, that figure has soared to 122 percent.
In other words, if we took the money generated by selling all of the goods and services produced in the US in the coming year (from lemonade stands to every single manufacturing plant) and used it to pay down the debt, the country would still be in the red by $8 trillion.
And, of course, that is not the government’s money to take; it just gets a part of that in the form of taxes. So let’s think about the debt in that way: Last year, the government collected $5.23 trillion in revenue, more than half of which comes from individual income taxes (while that seems like a lot, keep in mind that it also spent more than $7 trillion, which gets to the heart of the problem).
So, let’s say that the federal government starts spending nothing for a while (but still collects taxes). That means no military, no Medicare, no Social Security, no judges, no federal law enforcement, no Congress, no air traffic controllers, and not even a shiny new ballroom.
When Reagan took office, it was $4,000 (or about $17,000 in today’s dollars). Now, however, it has ballooned to $120,000 for every American, or $286,000 per taxpayer (i.e., not counting children, retirees, and billionaires like Trump who often avoid paying taxes altogether).
At the current rate (and taking into account those interest payments), it would take nearly a decade to eliminate all of that debt.
All of these numbers are almost too large to fathom, so it helps to look at the problem on an individual level.
The median income in the US is about $65,000. If somebody making that much money had as much credit card debt, percentage-wise, as the US, (which is a more apt comparison than a mortgage because a mortgage is backed by a property) that would come out to about $80,000. To get out of that debt, they would have to use every penny they earn for 15 months to pay off that credit card — without spending a dime on food, shelter, health insurance, taxes, gasoline, etc.
Or let’s look at the share of the debt per person. When Reagan took office, it was $4,000 (or about $17,000 in today’s dollars). Now, however, it has ballooned to $120,000 for every American, or $286,000 per taxpayer (i.e., not counting children, retirees, and billionaires like Trump who often avoid paying taxes altogether).
That is your share of the bill that the nation’s leaders have accrued over the past four decades or so.
And this is a bipartisan problem.
It’s been a century since an administration decreased the debt. In the eight years that Warren Harding (who died in office) and Calvin Coolidge were at the helm, it decreased $7 billion. Ironically, that is how much the debt increases every single day now.
Since then, it has just gone up, up, up.
In the first four years after Reagan made that nice speech, it was up 82 percent. Since then, the debt has increased less than 30 percent only three times — twice under Bill Clinton and then in Barack Obama’s second term.
We have no faith in these lawmakers, who refuse to make tough choices because they only worry about their next election and not the problems their inaction causes down the road — whether that’s related to the debt, climate change, or artificial intelligence.
That doesn’t necessarily mean Democrats are more responsible stewards of taxpayer money. Instead, it’s probably more of a reflection of how Republicans only care about fiscal responsibility when one of their own isn’t in the White House but they control Congress.
The main difference is that they are bigger phonies when it comes to the debt because there is no tax cut for billionaires or military increase that they don’t like (and, for what it’s worth, as Reagan and other GOP presidents have proven, none of that money is “trickling down” to regular Americans).
And that brings us back to the Gipper.
Reagan wasn’t wrong when he said that “to continue this long trend is to guarantee tremendous social, cultural, political, and economic upheavals.”
Now, different economists have different opinions as to when the debt becomes unsustainable. We believe that it already is for the simple reason that there is no political will to do anything about it.
We have no faith in these lawmakers, who refuse to make tough choices because they only worry about their next election and not the problems their inaction causes down the road — whether that’s related to the debt, climate change, or artificial intelligence.
This year, between one-fifth and a quarter of all government revenue will go toward paying interest on the debt. If that’s not unsustainable, then what is?
There are those who say there is no magic bullet to fix this.
Perhaps.
However, there is a pot of money that grows even more quickly than the US debt: the wealth of American billionaires.
Since 2020, the debt grew a little more than 30 percent under Joe Biden and it’ll be the same again under Trump (or more in light of the sluggish economy, high inflation, and a proposed $1.5 trillion military budget).
However, the wealth of US billionaires skyrocketed 32 percent in just the first year of Trump’s second term and totaled $2.2 trillion — more than the annual budget deficit.
And that’s just individual billionaires, not the other ultra-rich (there are nearly a million individuals in the US whose net worth is at least $10 million, and 74,000 households are worth $100 million or more) and corporations that are raking in record profits — often while being subsidized in some way by taxpayer money — while regular Americans are struggling with a surging cost of living.
That seems like a great place to start.
And we better get to it soon, because we are either on the precipice of the upheaval Reagan was predicting or (like Wile E. Coyote) we have already gone over that cliff without realizing it.
One way or another, what comes next won’t be pretty… and time is up.
- Klaus MarreKlaus Marre, a former congressional reporter, is a senior editor for US politics at WhoWhatWhy. He writes regularly here, and you can also follow him on Bluesky and Substack.
