ABSTRACT
Rising national debt and chronic deficits result from spending commitments made in an earlier and far different political era. When the economy seemed likely to boom forever, Washington mandated large increases in Social Security benefits and expansive new health care guarantees for the poor and elderly, Medicare and Medicaid. The economy refused to cooperate. Entitlement spending grew to be a majority of all federal spending. Since the programs had strong public and interest group support, Washington responded by sparing them from major cuts. A combination of exploding entitlement costs and the unbalanced Reagan budget policy moved the deficit into the stratosphere. Just about everyone in Washington wrung their hands over the red ink. The problems facing Social Security by 1977 reflected the drastic change in economic conditions that stopped all but a few benefit liberalizations after the mid-1970s. Economic growth slowed, reducing revenues to government.
