The U.S. national debt crossed the $40 trillion mark on Tuesday, according to the Treasury Department’s daily cash and debt balance statement released Wednesday, marking a doubling of the debt since 2017 and underscoring the fiscal strain from pandemic-era spending and subsequent policy responses.
Total public debt outstanding stood at $40.047 trillion, with $32.266 trillion held by the public and $7.782 trillion in intra-governmental holdings. The milestone follows a $25 billion auction of 30-year Treasury bonds that settled at the highest yield since 2021, reflecting elevated long-term borrowing costs. Yields on long-dated Treasuries reached their highest levels in nearly two decades, prompting Treasury Secretary Scott Bessent to announce a doubling of buyback sizes for 10- to 30-year securities to at least $4 billion per operation in an effort to temper yields.
The debt surge has been driven by overlapping fiscal pressures. During Donald Trump’s first term, public debt rose by $7.8 trillion, with more than half of that increase occurring in the final nine months of his presidency amid pandemic response measures. Under Joe Biden’s administration, debt increased by $8.4 trillion, fueled by COVID-19 recovery spending, infrastructure investment, and clean energy subsidies. Since Trump’s second term began in January 2025, the debt has climbed by an additional $3.8 trillion, bringing total growth across both terms to $11.6 trillion.
The Congressional Budget Office projects that Trump’s legislative package, the One Big Beautiful Bill Act, would add another $4.7 trillion to the debt over the coming years. Monthly deficits have remained elevated, with the Treasury reporting a $432 billion shortfall in July—the fourth-largest monthly deficit on record—attributed to negative customs receipts from tariff refunds and rising outlays for Social Security and Medicare.
Federal spending now exceeds $7 trillion annually, with 60% allocated to mandatory programs such as Social Security, Medicare, Medicaid, and veterans’ care. Interest payments on U.S. debt have become a growing fiscal burden, surpassing Pentagon funding in the 2025 fiscal-year budget for the first time and eclipsing Medicare outlays in the first 10 months of fiscal 2026, ranking as the second-largest budget line item behind only Social Security.
Maya MacGuineas, president of the Committee for a Responsible Federal Budget, warned that the debt’s trajectory poses broader economic risks, stating that the burden is ultimately borne by households through higher taxes, reduced public investment, and heightened vulnerability to future crises. The debt’s rapid expansion has also coincided with rising long-term Treasury yields, which have climbed alongside inflation concerns and global demand for dollar-denominated assets.
