Jim Freedman is a leadership consultant and author.
BRATTLEBORO-In the 18th century, Scottish Enlightenment thinker Adam Ferguson offered a stark warning to governments: A nation is in decline when it spends more servicing its debts than defending itself.
That threshold, once a theoretical marker of decay, has become a reality for the United States. In 2025, for the first time in modern history, our country will pay more in interest on its national debt than it will spend on national defense.
This is more than a budgetary quirk. It is a red flag for the health of our republic.
Ferguson, observing the rise and fall of empires, argued that societies reveal their strength or weakness by how they allocate resources. Strong nations invest in their survival - security, cohesion, and future growth. Weakening nations, by contrast, become consumed by their past commitments, spending more to service old debts than to secure new horizons.
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The United States is now on that path. According to the Congressional Budget Office, net interest payments in 2025 will exceed $870 billion, while defense spending will hover around $850 billion. Interest will keep climbing steeply, projected to surpass $1 trillion annually within a few years, with a bow to Mr. Trump's "Big Beautiful Bill."
Every dollar we send to bondholders to pay off our national debt - many of them overseas - reduces our ability to invest in the military, infrastructure, education, or innovation.
The problem is not simply financial. It is strategic.
A nation with resources tied up in debt service loses flexibility. Military planners must trim programs to meet interest obligations. Diplomats face constraints because foreign creditors hold leverage.
For example, China holds a significant amount of our securities, $780 billion, or about 8.9% of all foreign federal debt. This is more than enough to influence the bond market negatively if China so chooses. Even domestic priorities are reshaped by the iron grip of bond markets.
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In Ferguson's terms, the danger is that we become a society "spending on the past rather than securing the future." Rome in its later centuries was a classic example: As tax revenues were diverted to maintain debts and subsidize decadence, military preparedness decayed. Britain, too, faced similar warnings in the late 19th century as its debt service burden mounted while defense lagged.
To be clear, debt itself is not inherently destructive. Borrowing for productive investments - roads, research, education, health care - can strengthen the nation.
The danger comes when debt compounds to the point where interest alone exceeds critical spending on national security. That is where we now stand.
For decades, both political parties have contributed to this imbalance. Tax cuts without offsets, wars financed on credit, entitlement expansions with no revenue base and, more recently, pandemic-era spending have all layered new obligations onto the federal balance sheet.
The result: a $35 trillion national debt, with interest rates no longer near 0%.
Unlike discretionary programs, interest cannot be cut. It must be paid. That makes it the fastest-growing part of the federal budget - and a silent thief of future options.
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The solutions are not easy, but they are necessary. That means confronting the mismatch between what we promise and what we collect in taxes.
This is no time for tax breaks for those who need it least. Borrowing should be channeled into projects that yield long-term returns, not short-term political gains. Congress needs mechanisms to prevent constant deficit spending in boom times and force honest accounting of new commitments. Citizens must understand that unchecked borrowing eventually crowds out every other national priority, including defense.
Adam Ferguson's warning was not abstract philosophy. It was a lesson drawn from history. The United States still has the power to change course, but denial is no longer an option.
If we allow our future to be mortgaged to the past, we may wake up to find that we no longer have the means to defend what matters most.
That is the essence of Ferguson's red flag - and it is waving over Washington today.
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