For some people, their pulse beats faster when their favorite sports team wins, or their favorite musician drops a new album. For others, pulse and respiration accelerate when confronted with “Spending, Taxes, and Deficits: A Book of Charts.” If you (like me) are in this second category, Jessica Riedl has got your back (Brookings Institution, April 2026). This is a book with a lot of pictures and not too many words.
Here’s the basic picture. Federal debt as a share of GDP is near the highest level in US history, which happened after the US financed the fighting of World War II with borrowed money. National debt is now about $235,000 per US household. The pattern of the last two decades shows that we fought the Great Recession of 2008-09 and the pandemic recession of 2020 with borrowed money, too. Assuming no future giant recessions, wars, or pandemics, past tax cuts expiring when they are scheduled by law to do so, and interest rates not rising further, this is the path we’re on.
Those of you with long memories may recall that back in 2000, the US government actually had budget surpluses for a couple of years. What has changed since then? The short answer is tax cuts, higher spending on Social Security and Medicare, and higher spending on interest payments.
I sometimes talk to people who believe that the defense budget is the biggest part of federal spending. I heard someone refer to the “military-industrial complex” the other day, a phrase form President Eisenhower’s 1961 farewell address. If you hold this belief, time to update your priors. At the time of Eisenhower’s speech, defense was about half of all federal spending, while Social Security/Medicare and anti-poverty programs wer about 16% of federal spending. Those categories have now (roughly) switched places. Social Security/Medicare and antipoverty progrmas ar now 53% of total federal spending, while defense is about 13%.
One grim sign, when you are in debt, is the vicious circle where your interest payments are so high that you can’t reduce your current borrowing, and so you sinkhole of debt keeps getting deeper and deeper. On its current trajectory, interest payments in the US federal budget are headed down this path. The purple bars show the rise in federal interest costs since 2018; the green bars show the path the budget is currently on. On this path, about 30% of all federal revenues will be going to interest payments on past debt by 2036–and interest payments would be a higher cost than Social Security.
Reidl uses the charts to make a case that addressing the long-standing long-term insolvency of Social Security and Medicare would go a long way to addressing these issues. US politicians have been ducking this topic for decades, and continue to do so. Based on selection of charts and labels, Riedl is clearly less enthusiastic about tax increases, but in my own mind, going back in the direction of the tax burdens from back in 2000s can be a reasonable step as well. For example, I would favor moving the estate tax back toward its 2000 levels, and I’d at least be willing to talk about eliminating all income tax reductions–which at this point only apply to about 10% of all taxpayers who tend to have higher incomes. But Riedl offers the useful reminder that the more generous welfare states of Europe are not in fact financed by taxing high incomes and wealth at conspicuously above US levels, but instead by value-added taxes (think a national sales tax) and higher payroll taxes. In short, they provide additional middle-class benefits by taxing the middle class.
