Washington, Aug 21 (V7N)- The United States’ national debt has surpassed $40 trillion for the first time, raising fresh concerns over the country’s fiscal stability and long-term economic outlook.

According to the US Treasury Department, total US government debt has reached approximately $40.047 trillion. Of this amount, $32.27 trillion is Treasury securities held by the public, while $7.78 trillion represents debt held by government agencies.

The Treasury has warned that declining revenues, increased spending on social security programs and record interest payments are contributing to the rapid growth of the national debt.

Debt surged during Trump and Biden administrations

According to Reuters, US government debt stood at $19.95 trillion when Donald Trump first took office in January 2017.

Analysts estimate that around one-third of the increase since then was linked to emergency spending and lending programs introduced during the COVID-19 pandemic under the Trump and Joe Biden administrations.

The national debt increased by approximately $11.6 trillion during Trump’s two terms. About $7.8 trillion was added during his first term, while another $3.8 trillion has been added since he returned to office in January 2025.

During Biden’s four years in office, the national debt increased by approximately $8.4 trillion, driven in part by spending on pandemic recovery, infrastructure and clean-energy programs.

Debt reaches $40 trillion in record time

Maya MacGuineas, president of the Committee for a Responsible Federal Budget, said it took decades for US government debt to reach $1 trillion in 1981.

However, the debt has now risen from $39 trillion to more than $40 trillion in less than five months, highlighting the accelerating pace of borrowing.

More than $1 trillion spent on interest

Mandatory programs such as Social Security and healthcare account for more than 60 percent of the nearly $7 trillion the US government spends annually.

In addition, around $1.1 trillion is being spent on interest payments on the national debt.

Economists warn that continued growth in interest costs could further constrain government spending and increase pressure on the US budget.

Concerns over impact on economy and citizens

The US national debt has quadrupled in less than two decades. Some experts estimate that if the current borrowing trend continues, the debt could reach $50 trillion within the next six years.

Rising debt could contribute to higher inflation and place additional pressure on the country’s financial system, potentially affecting household purchasing power and living standards.

Pressure on bond market

The record debt is also having an impact on the US Treasury bond market. Yields on 10-year and 30-year Treasury securities have recently reached their highest levels in several years.

Investors are demanding higher returns amid concerns over rising government deficits, inflation and the sustainability of US borrowing.

Credit rating agency Moody’s also downgraded the US credit rating by one notch in 2025.

Michael Peterson, chief executive of the Peter G. Peterson Foundation, has warned that if current trends continue, US government debt could reach $50 trillion within six years.

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