Transcription
It's really shocking to observe that this year, for the first time, the United States federal government will spend more on interest payments on the federal debt than on defense. And in this chart, I uh try to sum up what I call Ferguson's law, which states that when a great power is spending more on debt service than on defense, it won't be great for much longer.
When a nation spends more money on paying its debts than on defending itself, history tells us it's already on the path of decline. And America isn't the first to go down this road. The Dutch Republic, Habsburg, Spain, the British Empire, they all collapsed after crossing that same threshold.
But this isn't just about numbers on a balance sheet. It's about what those numbers reveal. a system so consumed by debt, dysfunction, and short-term fixes that it can no longer protect its people or inspire their trust. At the top, leadership has grown older and more disconnected, clinging to power like a fading pallet bureau. And at the bottom, ordinary Americans are losing faith in the institutions that once held the country together. Drugs, suicides, despair. These are not isolated tragedies. They are signals of a society that feels abandoned.
The danger is clear. Without strong families, honest leadership, and institutions people can trust, the United States risks following the same path as every great power that thought it could defy history. The advent of Vice President Harris as the Democratic nominee doesn't radically alter the fact that American politics is geriatric. If you look at the slide on the uh the chart on the other side of this slide, the United States is a real outlier uh because its legislators are also substantially older than those of peer countries. So the point about gerontocracy doesn't apply only to presidential candidates and the advent of uh Camela Harris's candidate doesn't alter the fact that American politics is by the standards of the rest of the developed world somewhat geriatric.
The Soviet Union's economy was characterized by the soft budget constraint, which meant that state-owned enterprises were under almost no pressure to uh be economically efficient. That's in fact true of the US federal government, too. I spent a lot of my time thinking about US fiscal policy. It's really shocking to observe that this year, for the first time, the United States federal government will spend more on interest payments on the federal debt than on defense. And in this chart, I uh try to sum up what I call Ferguson's law, which states that when a great power is spending more on debt service than on defense, it won't be great for much longer.
One of the striking features of life in 1980s Soviet Russia was that nobody believed in the system anymore. The level of cynicism was staggering. But that is increasingly true of the United States. Look at these charts here. The Wall Street Journal ran a poll recently that showed a dramatic decline in the percentage of Americans who think that patriotism was very important to them or religion was very important to them or having children was very important to them. And if you look at national confidence in key institutions, it is at historic lows in almost every case. Public confidence in the US Congress which according to the constitution is the most important branch of the federal government is in single digits there too I think there's a resemblance but it's the public health data that clinch it and this is where we need to look past gross domestic product to look at well-being in a more meaningful sense Fact, as many Americans have died of suicide or drug overdoses in the last 10 years as died of COVID 19, 1.2 million. If you include the deaths from alcohol abuse, deaths of despair killed more people in the past 10 years in the United States than CO did.
Some of you will be aware of the mental health epidemic or ill health epidemic uh that young Americans suffer from. But in a way, it's less concerning to me than the excess mortality that we see amongst older Americans. I've put a couple of charts on the right hand side here from the work of Angus Deon and others showing what an extraordinary increase there has been in deaths of despair from suicide, alcohol poisoning or drug overdoses. And if you compare the United States with comparable countries including Australia, which is in the lower uh chart uh dotted blue line, you see that the United States has a completely unique trend with an extraordinary upward surge in deaths of despair unlike anywhere else.
The Financial Times recently delved deeper into the data and it makes the case, I think, very compelling that something's badly wrong. Uh something that nobody really wants to talk about, but you see it when you go to the swing states, spend time in Rust Belt, Pennsylvania, and you'll see what these charts mean in practice here. the extraordinary deterioration in male life expectancy at birth uh in the Soviet Union compared here with France and the explanation essentially alcohol consumption on a scale that probably set some kind of historic world record. I don't think human beings have ever consumed as much alcohol as people, particularly men did in the dying phase of the Soviet Union. I was from Glasgow. I remember going to Moscow and what was still Lennengrad and being deeply impressed. I'd never seen drinking like it. I have never seen it since.
What's the explanation? Why did Soviet men drink themselves to death? Oh, and smoke themselves to death. The price of cigarettes was subsidized. So was the price of vodka. There never was an anti-tobacco campaign. As soon as Gorbachov introduced the anti-alcohol camp campaign, of course, people drank way more uh because the party's legitimacy was so gone that if you were told not to drink in the Soviet Union, you ordered a liter of vodka and polished it off for breakfast. So what's the explanation? The explanation in the Soviet case was that people had completely lost their belief in the system and regarded the party as a massive scam. The cynicism was bone deep.
Huge percentages up to 90% of Ivy League types favor rationing of gas, meat, and electricity to respond to the challenges of climate change. You will not be surprised to find that this is a minority position amongst regular people. And I want to suggest to you that the party which is entirely dominant in the elite universities, entirely dominant in blue states like California where I live, the party is as detached from the lives of ordinary Americans as the party in the Soviet Union was detached from the lives of ordinary Russians. And this breeds a deep disillusionment and disenchantment with the system.
In so far as you can back it out of political donations, political contributions, roughly 95% of the journalistic profession is democratic. And in the academy, there are some fields like anthropology, sociology where it's 100%. There are literally no Republican donors in those fields. In fact, it's above 80% in just about every field except engineering. The ratios of uh Republicans to Democrats in the academy uh are tiny and impossible to calculate in some subjects because you can't calculate a ratio uh if there are zero Republicans. So the party controls the institutions of elite formation and propaganda. I mean the media. The party also controls much of the economy. Corporate donations tilt overwhelmingly to the Democratic side. The counties that vote Democrat are overwhelmingly richer than the counties in the United States that vote Republican. So, the party, as in the Soviet system, also controls the economy.
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