The US national debt has surpassed $40 trillion for the first time ever. The Treasury Department on 18th announced that it will expand its buyback program for long-term government bonds. As of the end of July, the US government's total debt reached $40.007 trillion, or 243% of gross domestic product, according to the Treasury Department's data. The milestone comes as lawmakers prepare for a potential showdown over government funding and the debt ceiling next month. The Treasury Department said in a statement that it will increase the size of its buyback program to $30 billion from $10 billion. The program, which began in 2000 and was suspended in 2002, was restarted last year with $10 billion in buybacks. The buyback program is aimed at improving liquidity in the government bond market and reducing the government's debt burden. The Treasury Department said it will continue to monitor market conditions and adjust the size of the buyback program as needed. The move comes as the US government faces a challenging fiscal environment, with a large budget deficit and a growing national debt. The US government's budget deficit was $1.1 trillion in the first 10 months of the fiscal year, up 121% from the same period last year. The Treasury Department's announcement comes as lawmakers are preparing for a potential showdown over government funding and the debt ceiling. The debt ceiling, which is currently set at $31.4 trillion, needs to be raised or suspended by Congress to avoid a default on US debt. Lawmakers are expected to face a tough battle over government funding and the debt ceiling, with some Republicans calling for spending cuts and others opposing any increase in the debt ceiling. The US government's growing national debt has raised concerns among some lawmakers and economists, who warn that it could lead to higher interest rates and slower economic growth. The Treasury Department's move to expand its buyback program is seen as a step to address these concerns and improve the government's fiscal position. However, some critics argue that the buyback program is a short-term solution and does not address the underlying issues driving the US government's debt burden. They argue that lawmakers need to take a more comprehensive approach to addressing the US government's fiscal challenges, including reforms to entitlement programs and the tax code. Despite these concerns, the Treasury Department's move to expand its buyback program is seen as a positive step by some analysts, who argue that it will help to improve liquidity in the government bond market and reduce the government's debt burden. The US government's growing national debt is a complex issue that requires a comprehensive solution. The Treasury Department's move to expand its buyback program is a step in the right direction, but lawmakers will need to take a more comprehensive approach to addressing the US government's fiscal challenges.
The United States national debt has reached a record high of 40 trillion dollars, surpassing a significant milestone. The debt increase is primarily driven by tax cuts, social security and medical expenses, and interest costs, leading to growing concerns about the country's long-term financial sustainability. According to the latest daily cash and debt report released by the US Treasury on January 19, the total public debt of the United States was $40.47 trillion as of the previous day, 18th January.
This includes $32.26 trillion in market-held debt held by private individuals, foreign governments and investors, and the Federal government's internal accounts totaling $7.782 trillion.
The national debt has more than doubled since Donald Trump's first term began in January 2017, from $19.5 trillion to over $40 trillion. During Trump's two terms, the debt increased by $11.6 trillion in total, while during Joe Biden's four years in office, it grew by $8.4 trillion. Over one-third of the debt increase since 2017 can be attributed to large-scale borrowing to combat the COVID-19 pandemic.
However, future burdens are expected to be substantial. The Congressional Budget Office (CBO) estimates that the debt under Trump's second term would increase by a further $4.7 trillion due to the "One Big Beautiful Law" tax and spending bill. The US government spends around $7 trillion annually, with about 60% going towards mandatory expenses such as Social Security, Medicare, Medicaid, and veterans' benefits.
Interest costs alone amounted to about $1.1 trillion annually, surpassing defense spending for the first time in 2025. In the first ten months of the 2026 fiscal year, healthcare spending is projected to become the second-largest budget item after social security benefits. Market's growing sensitivity to fiscal deterioration is evident as 30-year US Treasury yields have risen to a recent high of 5.34%, and foreign investors, who hold about one-third of US Treasuries, have reduced their demand in the past year.
To counter the upward trend in long-term interest rates and maintain market liquidity, Treasury Secretary Steven Mnuchin announced plans to expand the size of the bond-buyback program from its current maximum of $2 billion per day to a minimum of $4 billion. The expansion will take effect starting September 9 and will continue until November 4.
Written by urgent.news from Hankyoreh's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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