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The United States’ national debt has surpassed the historic $40 trillion mark for the first time as government spending continues to outpace revenue, raising fresh concerns over the fiscal health of the world’s largest economy.
According to the latest data released by the US Treasury Department on Wednesday, the country’s debt has doubled over the past decade. Economists and political analysts have warned that the rapidly rising debt burden could pose serious risks to the US economy.
When Donald Trump took office for his first term in January 2017, US national debt stood at $19.95 trillion. Since then, it has doubled. Nearly one-third of the increase occurred in the two years following the outbreak of the Covid-19 pandemic in March 2020, when both the Trump and Joe Biden administrations borrowed heavily to deal with the economic fallout.
US debt has increased by $3.8 trillion since Trump returned to office for his second term in January 2025, bringing the total increase during his two terms to $11.6 trillion. By comparison, debt rose by $8.4 trillion during Biden’s four-year presidency.
Much of the borrowing under the Biden administration was used for pandemic recovery, infrastructure investment, clean-energy subsidies and other major Democratic policy initiatives.
Margaret Spellings, president and CEO of the Bipartisan Policy Center, warned that the government is spending far more than it collects in revenue, while the largest areas of the federal budget are effectively operating on autopilot.
The huge federal debt is already increasing the cost of living and crowding out other important spending and investment, she said, posing a major threat to the US economy and Americans’ long-term prosperity.
The $40 trillion debt translates into roughly $117,000 per US citizen and about $297,000 per household. According to the Washington-based Peter G. Peterson Foundation, the US debt is roughly equivalent to the combined GDP of five major economies—China, Germany, Japan, the United Kingdom and India.
Treasury data showed that the US monthly budget deficit reached $432 billion in July, the fourth-largest monthly deficit in the country’s history.
Tariff revenues have turned negative for three consecutive months as the Trump administration has been required to refund tariff payments following court rulings invalidating some of the tariffs. At the same time, spending on Social Security and Medicare for older Americans has continued to rise.
As a result, the budget deficit during the first 10 months of fiscal 2026 has already exceeded the total deficit recorded during the entire 2025 fiscal year, with two months still remaining.
The Committee for a Responsible Federal Budget said policy decisions under both Trump and Biden accelerated the growth of federal debt, despite partisan disagreements.
The Congressional Budget Office estimates that Trump’s signature second-term legislation, the One Big Beautiful Bill Act, will add another $4.7 trillion to the debt.
Although Trump initially tasked the Department of Government Efficiency (DOGE) with cutting federal spending, its efforts were largely focused on discretionary spending, which represents the smaller portion of the federal budget.
The US government currently spends about $7 trillion a year, with around 60% allocated to mandatory programmes such as Social Security, Medicare, Medicaid and veterans’ benefits. These expenditures generally increase along with the cost of living.
Another $1.1 trillion is spent annually on interest payments on the national debt. In fiscal 2025, interest payments exceeded the total budget of the US Department of Defense for the first time in history.
During the first 10 months of fiscal 2026, interest payments surpassed Medicare spending, making debt servicing the second-largest category of federal expenditure after Social Security.
The growing financial burden is being driven in part by the retirement and healthcare costs of the baby-boomer generation, while revenue from income and payroll taxes has failed to keep pace with those expenses.