Broke Down

Forget the government shutdown. America's biggest problem is Washington’s refusal to address our $37.3 trillion debt. Ferguson’s Law is poised to exact a harsh penalty.

Senator Alan Simpson, a Wyoming Republican who died on March 14, 2025, was the last prominent US politician to give serious attention to addressing the national debt. Source: Wikipedia.

Broke down, cracked and shattered; Left in pieces like it never even mattered; There’s no turnin’ round, it’s broke down. — Slaid Cleaves, “Broke Down”

I’m long the United States of America. The list of advantages the US has over the rest of the world is long. As I explained last year in “Five Reasons To Be Bullish on the United States,” I noted that the US has significant advantages in education, demographics, geography/agriculture, energy, and the Constitution. I ended that piece with a quote from the late Molly Ivins, who famously said, “I’m optimistic to the point of idiocy.”

I am still optimistic about the future of the US. However, the looming government shutdown — which will occur at midnight unless something miraculous happens over the next few hours — combined with the refusal by our leaders in Washington to address out-of-control federal spending seriously, has tempered my optimism. I’m not alone. Inflation is accelerating and investors are piling into gold, the price of which has jumped by about 50% over the past 12 months.

The looming government shutdown, the fourth since 2018, is another example of brinksmanship between Congress and the White House. Although it’s annoying, the shutdown won’t do permanent damage. By contrast, the soaring federal debt, which now stands at $37.3 trillion, poses a permanent and pernicious threat to America’s role as a superpower. Why? The interest payments on the debt now exceed what we are spending on defense. As Scottish philosopher Adam Ferguson explained in a famous essay in 1767, any nation in that predicament ceases to be a great power.

Here’s a look at Ferguson’s Law, recently coined by the Hoover Institution’s Niall Ferguson, the staggering scale of our national debt, and what should — repeat, should — happen in Washington. I’ll start by looking back to 2010 and the Simpson-Bowles Commission, which was the last time that Congress and the White House got serious about addressing America’s reckless dance with debt.