What You Can Do To Solve the Debt Crisis 

Paul Ryan, former speaker of the U.S. House of Representatives, recently spoke to AMG clients about America’s future in the face of an ever-rising mountain of debt and the federal government’s landslide of deficit spending. 

The numbers are scary. 

The budget deficit was $1.7 trillion for the 2023 fiscal year, which ended Sept. 30. That’s 60% higher (inflation adjusted) than in 2018 before the pandemic. Even more startling, deficit spending this year accounted for 6.3% of the U.S. GDP, up from 5.4% in 2022. The overall debt stands at $33.6 trillion dollars, a nearly unfathomable number.  

By the middle of this century, the Congressional Budget Office (CBO) estimates that publicly held debt will grow from about 90% of GDP to about 180%. 

The reason is simple—entitlements (Social Security, Medicare, etc.) and interest payments on the debt. They now account for close to 70% of federal spending. And as America continues to gray and use those services, the numbers will grow and eat away at America’s prosperity. 

Ryan pointed out that there are solutions, but the debt problem isn’t yet a high enough priority for Congress and the president to act. That’s unsettling. A veteran in the audience asked what each of us can do? 

His answer was simple—get informed. Inform others. Talk to your elected officials.  

Let them know you are aware of the issue, your concerns and that changes need to be made.  

He’s right. The answer to this problem rests with us. In our homes, our communities and our states.  

Part of the solution is determining how we can grow our economy out of this mess. We did it after World War II when the federal debt hit $285 billion, which is nearly $5 trillion in today’s dollars. From 1950 to 2000, average real GDP growth in America ranged annually between 3.1% to 4.5%. Unfortunately, the CBO forecasts U.S. growth in the 2% range over the next few decades. A big difference. 

With the labor force unlikely to grow much in the coming decades, the only way America can make the gains it needs is to increase worker productivity. Education is the key. 

America is blessed with exceptional higher-education systems. Our colleges can help mold future innovators, scientists, engineers and researchers to maximize the use of new technologies, such as artificial intelligence, robotics and data analytics. 

But our public schools are challenged, particularly in the wake of the pandemic. Proficiency levels in reading and math across the country are in decline. We are not graduating enough university or trade school-ready adults. Making the issue even worse is this academic failure has a high correlation to family instability, which is also on the rise. Many are calling it a lost generation of students. 

That’s where you and I come in. We need to support families with school-age children and push for programs that produce better academic results. Education is a local issue—and the foundation for a prosperous country.