Henry Bowman
Has No Life - Lives on TB
US National Debt Tops $40 Trillion
The U.S. Capitol Building, the seat of the United States Congress, Washington, D.C. (Alan Lexa/AP)
By Newsmax Wires | Wednesday, 19 August 2026 04:39 PM EDT
The U.S. national debt has topped $40 trillion, roughly 100% of gross domestic product, a level last seen during World War II, The Wall Street Journal reports.
The nation’s outstanding public debt surpassed the $40 trillion mark Tuesday, reaching $40.047 trillion, up from $39.987 trillion the previous day, according to Treasury Department data released Wednesday.
Debt held by the public stands at about $32.3 trillion, or 101% of GDP, according to government data. That compares with just 31.5% of GDP in 2001, after four consecutive years of federal budget surpluses.
The dramatic increase in debt to reach the milestone of $40 trillion reflects more than two decades of wars, tax cuts, and economic crises.
The bursting of the dot-com bubble, military operations in Afghanistan and Iraq, and tax reductions pushed the federal budget off course in the early 2000s.
The 2007-09 recession then drained tax revenue and prompted Washington to approve costly stimulus programs.
The COVID-19 pandemic accelerated the borrowing surge as the government spent trillions of dollars on relief payments, business assistance, and other measures intended to support the economy.
At the same time, America's aging population has increased spending on Social Security and Medicare, while federal revenue has failed to keep pace with expenditures.
The imbalance is expected to worsen sharply.
The Congressional Budget Office projects debt held by the public will reach 120% of GDP by 2036, surpassing the previous record of 106% set in 1946.
U.S. debt is projected to hit a staggering 175% of GDP by 2056 if current laws generally remain unchanged.
Annual budget deficits are running near 6% of GDP, a level historically associated with wars or recessions. Yet the government is posting those shortfalls even without a major economic downturn.
The expanding debt has not caused a broad revolt in the Treasury market. Investors worldwide continue to view U.S. government securities as highly liquid safe-haven assets, allowing Washington to borrow without triggering a full-blown fiscal crisis.
But the cost of servicing the debt is becoming increasingly difficult to ignore.
The CBO projects annual net interest spending will rise from 3.3% of GDP in 2026 to 4.6% in 2036 and 6.9% by 2056. At that point, interest costs would exceed federal spending on either Social Security or Medicare.
Higher interest expenses leave lawmakers with less money for other priorities and make deficit reduction more difficult because those payments cannot simply be eliminated.
Meaningful spending cuts also remain politically challenging.
Much of the federal budget supports Social Security, Medicare, and other benefits for individuals, while the remainder — including federal salaries, buildings and law enforcement — represents a comparatively small share of total spending.
That leaves Washington facing increasingly difficult choices: raise taxes, reduce popular benefits, or continue borrowing at a pace the CBO says cannot be sustained indefinitely.
