Until 1980 the national debt was mostly a result of what?

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pohnpei397 | College Teacher | (Level 3) Distinguished Educator

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Looking at and interpreting a graph from Macroeconomics by McEachern, I would argue that most of the federal debt in 1980 came as a result of defense spending.

Defense spending made up around 50% of all federal outlays in 1960.  This declined, especially after the end of the Vietnam War, but it was still around 25% of all outlays in 1980.  For the whole period 1960 to 1980, defense spending is the single biggest category of outlay.  Moreover, defense spending was surely a bigger portion of federal spending during WWII and the Korean War--especially since there were fewer social programs during those days.

So, looking at that graph, I think that the best answer is that defense spending was the cause of most of the debt before 1980.


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