The federal government spent around 7 trillion dollars last year, which amounts to about $222,000 every second. It’s hard to imagine, really—even the most extravagant railroad moguls from the Gilded Age might feel a bit embarrassed by those numbers. Surprisingly, the reaction in Washington was largely indifferent.
That indifference, however, carries significant consequences. The federal debt has surpassed the entire US economy’s value. The annual deficit has nearly hit 2 trillion dollars. Interest payments, which essentially serve as fees for borrowing to cover previous debts, amounted to $970 billion last year. Those figures are, well, more than three times what the Congressional Budget Office projected for fiscal year 2025 just four years ago.
CBO Director Philip Swagel has cautioned that the country is entrapped in a “slow spiral of increasing debt and increasing debt repayments.” It’s slow for sure, but a spiral nonetheless.
This situation didn’t just happen overnight. The federal budget process itself, meant to impose some level of order on fiscal decisions in Washington, is, well, a bit of a disaster. The current framework, established back in 1974, feels like a relic from an era of bell-bottoms and rotary phones.
The Congressional Budget and Foreclosure Control Act was a response to perceived executive overreach—after President Nixon chose not to spend funds that Congress had appropriated. The idea was to give Congress the tools it needed to manage the federal budget more effectively.
Today, though, that act feels more like a ceremonial piece of legislation. Budget resolutions get delayed or completely abandoned, and instead of passing individual spending bills as scheduled, Congress often jumbles them together into enormous last-minute agreements worked out behind closed doors. What was once a last resort has become the norm.
The consequences? Predictable, really: less transparency, less accountability, and more spending. In fact, last year’s federal expenditure was 57.6% higher than expected. This isn’t just a minor error; it’s symptomatic of a structural issue.
To illustrate just how broken this process is, think about John Yarmuth, the Democratic House budget chairman of the Kentucky House of Representatives. He was recorded in 2021 saying, “[the federal government] doesn’t have to balance your checkbook. We’re like the bankers in Monopoly—we create the money, allowing others to play the game.” It’s a wild perspective, and unfortunately, it isn’t uncommon. This mindset led to an accumulated deficit of $9.1 trillion over the last five years.
But wallowing in despair isn’t exactly a solution. What we need is reform.
The way forward isn’t necessarily unclear. The debt ceiling debates in the early 2010s prompted bipartisan discussions, including proposals for spending caps and deficit-reduction targets. Ultimately, politics got in the way, but the ideas themselves were sound.
These concepts deserve a second chance—and they could make a real difference. A revamped budget process should treat fiscal resources not as boundless but rather as limited. This would force lawmakers to consider actual trade-offs among national priorities. It would entail giving serious thought to the economic impacts of financial decisions before they’re made, increasing public transparency, and ensuring that minority opinions aren’t overlooked in the rush to finalize resolutions.
It’s essential to create a framework that gains bipartisan support; reforms that can’t get through are just nice theories on paper.
We can’t act as if the problem is only about discretionary spending. Mandatory programs and interest are the fastest growing segments of the budget, and ignoring this is hardly reform—it’s just showmanship.
Financial instability moves slowly, but it is a real threat. The market will take notice. Allies will notice. Even adversaries will notice.
It’s been 50 years since the 1974 budget process came into place. That’s long enough. The system meant to impose fiscal discipline now perpetuates the very dysfunction it aimed to address.
It’s high time to implement a modernized approach that emphasizes accountability, necessitates trade-offs, and treats taxpayers’ money with respect rather than as if it were playing Monopoly money.
Because it isn’t.
