The United States has an addiction to spending. For decades, the federal government has promised more than it can afford, borrowing year after year to make up the difference. However, we may be reaching a tipping point and if we refuse to reform ourselves now, the choice will not be ours later. Spending cuts or the elimination of federal programs will be forced on us when our fiscal house collapses under the weight of debt.
The facts are sobering. Since 1974, federal revenues have averaged 17.3 percent of GDP, while spending has averaged 21.1 percent. Even in 2000, when revenues peaked at 20 percent of GDP, they still fell short of the spending average. The banalities of many may talk endlessly about “closing loopholes” and “making the wealthy pay their fair share.” But the math is unavoidable: Raising taxes alone will not solve our problem. Without addressing mandatory spending, the budget will remain in permanent deficit.
The Congressional Budget Office projects that from 2026 through 2035, mandatory spending programs and interest payments alone will consume 101 percent of all revenues. In other words, every dollar spent on schools, infrastructure, national defense, or tax relief will be borrowed. Economic growth may help on the margins, but growth cannot keep pace with unchecked promises. Until we deal with the elephant in the room—entitlements—true fiscal responsibility will remain out of reach.
This reality demands tough choices. Social Security and Medicare are lifelines for millions of Americans, but absent reform they are on unsustainable paths. The Social Security trust fund is projected to run dry by 2033. At that point, only 77 percent of promised benefits could be paid. Today, the average retired worker receives about $2,005 a month. Without reform, that will fall to roughly $1,544 in just eight years—a devastating cut at the very time seniors are facing higher costs from every direction. Pretending the status quo is “protecting seniors” is a dangerous lie.
Healthcare faces the same challenge. One in five Americans is on Medicaid, and Medicare remains the backbone of senior coverage. Medicaid finances 60 percent of nursing home residents. If the government continues its current trajectory, cuts may not be optional; they will be imperative and catastrophic. Vulnerable seniors could face reduced care, overcrowded facilities, or even homelessness if they can no longer afford assisted living. Modest reforms now—raising eligibility ages gradually, adjusting benefits slightly, or increasing premiums for wealthier retirees—could help prevent devasting reductions later. An ounce of prevention is truly worth a pound of cure.
And the impact extends far beyond seniors. Because mandatory spending consumes so much of the budget, other priorities are already being crowded out. In 2024, education, training, and social services accounted for just 2.8 percent of federal spending. Transportation was only 1.8 percent. Together, these vital functions totaled less than 5 percent of the budget. Meanwhile, interest on the debt consumed nearly 12 percent. In 2024 alone, $881 billion was spent on net interest payments—money that produced no schools, no bridges, no medical breakthroughs. Every dollar eaten up by entitlement growth or debt service is a dollar unavailable for the investments that drive opportunity and innovation.
The political reality makes this even more daunting. Leaders who dare to propose reforms are often punished at the ballot box. France recently offered a cautionary tale. Prime Minister François Bayrou, a centrist, tried to rein in debt by proposing tough spending cuts. Nine months later, he was ousted in a no-confidence vote. France’s deficit was 5.8 percent of GDP when Bayrou fell. The US deficit is already 6.4 percent, with debt approaching 100 percent of GDP. If other nations can be destabilized by ignoring the fiscal reality, why should we think ourselves immune?
Entitlement reform cannot be the work of one party or one politician. It requires bipartisan cooperation and political cover. One potential solution is to build in automatic triggers—fail-safe spending restraints that activate if Congress fails to act. Another is to phase in reforms gradually, designed by past Congresses, so that current leaders are insulated from the immediate backlash. These mechanisms would give lawmakers the space to tell the truth without ending careers.
The failure to act will have consequences that go beyond the fiscal math. Without modest reforms now, we will face severe benefit cuts, draconian tax increases, and slower economic growth later. Future Americans will inherit fewer opportunities and heavier burdens. Entitlement reform is not only a fiscal necessity; it is a moral responsibility.
Reform does not mean abandoning seniors or stripping away the social safety net. It means strengthening these programs so they remain viable for decades to come. It means being honest with the American people that we cannot have everything we want without paying for it. And it means taking the long view, even when the short-term politics are brutal.
The truth is simple: Failure to act now means harsher action later. Entitlement reform is not a political talking point. It is the most important step we can take to secure both our nation’s finances and its future.
Dr. Joseph McCormack has more than 15 years of experience as an economist and subject-matter expert, specializing in economic policy analysis, forecasting, financial institutions, and econometric modeling. His expertise spans translating complex research into clear economic storytelling, evaluating fiscal and legislative policy, and leading teams in model validation, predictive analytics, and risk assessment.
