The United States is on a borrowing path that risks placing an “undue burden on future generations,” according to new research from the American Action Forum, adding to growing anxiety about the long-term impact of the nation’s swelling debt. Economists and financial leaders warn that younger Americans are likely to face higher interest rates, weaker economic growth, and slower wage gains as a result of today’s fiscal choices.
The warning comes as the US debt burden continues to climb, now standing at roughly $38 trillion. Concerns about the scale and sustainability of this debt are no longer confined to academic circles. JPMorganChase CEO Jamie Dimon and Federal Reserve Chairman Jerome Powell have both publicly flagged the issue, while recent figures show the government paid around $10 billion a week in interest during the opening months of the 2026 fiscal year.
At the core of economists’ fears is a growing mismatch between government borrowing and the underlying growth of the US economy. If that gap widens further, investors who buy US government bonds may demand higher returns to compensate for the perceived risk. That would push borrowing costs even higher. Some analysts worry the Federal Reserve could step in by expanding the money supply to keep markets stable, a move that could reignite inflation. Ultimately, that combination could force painful cuts to government spending.
Bridgewater Associates founder Ray Dalio has likened such a scenario to an economic “heart attack,” where debt servicing crowds out productive government investment. In this environment, spending that supports long-term growth could be squeezed to make room for interest payments.
Younger Americans, the American Action Forum argues, would feel the sharpest effects. Jordan Haring, the think tank’s director of fiscal policy, wrote this week: “The United States’ high debt load exacerbates generational imbalances. These imbalances will ultimately burden younger and future generations with higher interest payments, slower economic growth, slower income growth, and a greater burden to bear for future tax or spending changes.”
She added, “Without significant policy changes to reduce debt growth, future generations will inherit a budget where significant resources are locked into servicing past borrowing.
“As interest costs rise, the federal government will have less money available for education, infrastructure, or scientific research—areas that directly support long-term prosperity. Future taxpayers will face higher tax burdens or reduced government services simply to cover the costs created by previous budget deficits.”
Haring pointed to stark differences in how federal dollars are allocated. In 2025, the Department of Education requested $82.4 billion, while Medicaid spending topped $900 billion in 2024, according to the Medicaid and CHIP Payment and Access Commission. As the population ages, spending on healthcare and social care is expected to rise further. At the same time, falling birth rates mean fewer workers contributing to government revenues, intensifying the strain on public finances.
While the American Action Forum has faced criticism in the past for its conservative leanings, similar concerns have been voiced by figures across the financial industry. BlackRock CEO Larry Fink echoed the generational argument in his annual letter to investors last year, calling for “an organized, high-level effort” to rethink retirement systems.
In that letter, Fink wrote: “The federal government has prioritized maintaining entitlement benefits for people my age (I’m 71) even though it might mean that Social Security will struggle to meet its full obligations when younger workers retire.”
He continued: “It’s no wonder younger generations, millennials, and Gen Z, are so economically anxious. They believe my generation, the baby boomers, has focused on their own financial well-being to the detriment of those who come next. And in the case of retirement, they’re right.”
The Great Wealth Transfer option
As economic power shifts between generations, governments may look to new sources of revenue. Over the next two to three decades, estimates suggest between $80 trillion and $124 trillion will be passed down from older Americans to younger ones in what has become known as the Great Wealth Transfer. Baby boomers, the wealthiest generation in history, are expected to leave vast sums to Gen X, millennials, Gen Z, and surviving spouses.
Experts say this transition will not go unnoticed by governments facing high debt and persistent deficits. “The change in wealth comes at a time when many governments around the world have high debt and deficits. It seems unrealistic to suppose that governments will just sit idly by as this wealth moves around.
We would expect governments to attempt to mobilize that wealth to help fund their debt, but in doing so, that denies private sector investment access to some of those funds.” For younger generations already facing economic uncertainty, the combination of rising debt, aging populations, and shifting wealth may shape the financial landscape for decades to come.
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