US national debt passes record $40 trillion

The total debt of the United States has surpassed $40 trillion for the first time, sparking concerns about a potential fiscal crisis as government spending exceeds revenue. The debt stood at $19.95 trillion in January 2017, when Donald Trump was inaugurated as president, and has since doubled. Over two years following the COVID-19 pandemic's declaration in March 2020, approximately one-third of that increase occurred.

Both Trump and his successor, President Joe Biden, incurred substantial borrowing during their presidencies, with the debt growing by $3.8 trillion since Trump’s second inauguration in January 2025 – totaling $11.6 trillion across both terms. Biden's tenure has seen an additional $8.4 trillion in debt, driven by pandemic recovery spending, infrastructure investment, clean energy subsidies, and other Democratic priorities.

Margaret Spellings, CEO of the Bipartisan Policy Center, remarked that federal programs spend more than revenue, with major budget items operating on autopilot. This debt translates to roughly $117,000 per person and $297,000 per household in the US. It equates to the combined economies of China, Germany, Japan, the United Kingdom, and India.

As of July 2025, the US Treasury reported its fourth-highest monthly deficit – $432 billion – due to refunded tariffs struck down by courts, and growing Social Security and Medicare benefits. The first 10 months of fiscal 2026 have already surpassed the deficit of the entire 2025 fiscal year, with two months remaining. Trump's second term has largely ignored fiscal hawks in his party, emphasizing prolific spending.

His landmark second-term legislation, the One Big Beautiful Bill Act, will add $4.7 trillion in debt. Despite championing cost-cutting, Trump's policy choices have inflated the federal debt trajectory beyond what would have accumulated under existing spending statutes. The US spends about $7 trillion annually, with mandatory programs like Social Security, Medicare, and veterans' care constituting 60% of the budget and growing to keep pace with living costs.

Interest payments on federal borrowing, which have surpassed Pentagon funding for the first time in fiscal 2025, account for another $1.1 trillion. The debt service costs for the 2025 fiscal year exceed Pentagon funding, while interest costs have eclipsed Medicare healthcare expenditures, becoming the second-largest line item in the budget.

The "baby boom" generation's retirement and healthcare costs strain Social Security and Medicare trust funds as payroll and income tax revenues fail to cover federal expenses.