Summary:
Federal debt has increased about $11.6 trillion during President Donald Trump’s two terms to date.
The debt grew about $8.4 trillion during President Joe Biden’s four-year term.
Tax cuts have constrained revenue as mandatory benefit spending and interest costs have climbed.
THE U.S. DEBT has crossed $40 trillion for the first time, more than doubling in less than a decade as tax cuts, pandemic spending, social-safety-net costs and interest payments widened the gap between federal revenue and outlays.
The Treasury’s Debt to the Penny data showed total public debt outstanding at $40.047 trillion Tuesday. Treasury securities held by the public accounted for $32.266 trillion. Intragovernmental holdings made up another $7.782 trillion.
The federal debt stood at $19.95 trillion when Trump began his first term in January 2017. The government has added more than $20 trillion since then.
The total now exceeds one year of U.S. economic output by roughly 20%. Debt grew sharply in response to the 2007-2009 financial crisis and accelerated again during the COVID-19 pandemic beginning in 2020.
The Climb From $19.95 Trillion
Debt increased by $7.8 trillion during Trump’s first term. More than half of that amount accumulated during the final nine months of his presidency, when the government borrowed heavily to finance its pandemic response.
The debt grew another $8.4 trillion during Biden’s term. His four years included continued COVID-19 recovery spending and major federal investments in infrastructure, clean-energy subsidies and other Democratic priorities.
Since Trump returned to office in January 2025, the debt has increased by about $3.8 trillion. Growth during his two terms has reached approximately $11.6 trillion.
Roughly one-third of the increase since January 2017 occurred during two years of intense pandemic borrowing under Trump and Biden. Policy decisions made during both presidencies and long-running imbalances between taxes and spending account for the remainder.
The Committee for a Responsible Federal Budget’s analysis found that decisions approved by both presidents raised the federal debt trajectory above the amount projected under the spending laws in place when each entered office.
Tax Cuts and Spending Commitments
Tax cuts have held down federal revenue as the cost of benefit programs and debt service has grown.
Trump championed heavy spending during his first term and has continued that approach in his second. His One Big Beautiful Bill Act is projected to add $4.7 trillion to deficits.
Trump has presented his second presidency as a cost-cutting administration. Early reductions ordered through the Department of Government Efficiency included federal agency job cuts. Much of the spending reduction has concentrated on discretionary programs, the smallest portion of the federal budget.
The government spends roughly $7 trillion annually. About 60% of federal spending goes to mandatory programs, including Social Security, Medicare, Medicaid and veterans’ care. Those programs generally grow with living costs.
The retirement and health-care needs of the baby-boom generation are increasing federal costs. Payroll and income-tax revenue has fallen short of covering the government’s obligations, straining the trust funds supporting Social Security and Medicare.
The budget gap remains large. The Treasury reported a July deficit of $432 billion, the fourth-highest monthly deficit in U.S. history.
Tariff refunds pushed customs receipts below zero for a third consecutive month. Spending on Social Security and Medicare continued to increase. The deficit during the first 10 months of fiscal 2026 has already exceeded the total recorded for all of fiscal 2025.
Interest Has Become a Major Budget Expense
The government is spending about $1.1 trillion a year on interest. That bill grows as the amount of debt and Treasury yields rise.
Rolling 12-month interest costs have remained above $1 trillion since early 2024. They are more than twice their 2020 level.
Debt-service costs surpassed Pentagon funding for the first time in fiscal 2025. During the first 10 months of fiscal 2026, interest costs exceeded Medicare outlays and became the second-largest item in the federal budget after Social Security.
“Forty trillion dollars of debt doesn’t exist solely on the government’s ledgers; it is felt throughout the economy and finds its way to the pocketbooks of people one way or another,” said Maya MacGuineas, president of the nonpartisan Committee for a Responsible Federal Budget.
“The more we borrow, the more we exacerbate inflation, squeeze out other priorities in the budget, and leave ourselves vulnerable to emergencies at home and turmoil abroad,” MacGuineas said.
Pressure in the Treasury Market
Investors have demanded greater compensation to hold long-term U.S. government debt as Treasury issuance has increased.
A $25 billion auction of 30-year Treasury bonds produced the highest yield for such a sale since 2021. Yields on long-dated Treasury securities reached their highest levels in nearly two decades Tuesday.
The term premium on 10-year Treasuries, which measures the portion of the yield attributed to the risk of holding the securities over a decade, rose to its highest level in more than 12 years.
Foreign investors hold nearly one-third of all Treasury securities. Demand from those investors has declined over the past year, leaving more bonds for price-sensitive buyers and increasing the potential for market volatility, Oxford Economics analyst John Canavan wrote Tuesday.
Treasury Secretary Scott Bessent announced Wednesday that the government would double the size of certain debt-buyback operations involving 10- to 30-year securities to at least $4 billion per operation.
The Choices Facing Lawmakers
The debt reached $40 trillion less than five months after crossing $39 trillion. It has quadrupled in less than 20 years. The United States first accumulated $1 trillion in debt in 1981.
“It is staggering how predictable the fiscal decline of a global power can become,” MacGuineas said.
Budget watchdogs have warned that the current fiscal path could produce a debt crisis. Changing that path requires lawmakers to raise taxes, cut spending or pursue both.
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We owe the Nation’s weight in gold,
and yet the plan is still to spend—
on smoke and mirrors to behold
a lie we built upon our end.
We know he doesn't care. It's not his money.