The US national debt $40 trillion milestone has been crossed, and the cost of servicing that debt is now climbing fast enough to reshape household finances, crowd out public spending and unsettle bond markets around the world. According to the Bipartisan Policy Center, net interest payments on that debt are projected to surpass $1 trillion in the 2026 financial year and to double to $2.1 trillion by 2036, a trajectory that is already drawing alarm from economists on both sides of the political spectrum.
The crossing of the $40 trillion line was not a surprise. Public spending surged under both the Donald Trump and Joe Biden administrations, while ballooning costs for social programmes were compounded by tax cuts that eroded revenues. The 2008 financial crisis and the Covid pandemic each required large-scale borrowing, and more recent inflation shocks prompted sharply higher interest rates, making every subsequent dollar of debt more expensive to carry.
How Fast Is US National Debt Growing?
The pace of accumulation is now hard to grasp in everyday terms. The figure is rising by roughly $90,000 every second, or $7.8 billion a day, according to the Congress Joint Economic Committee. At the start of Trump’s first presidential term in 2016, total debt stood at just under $20 trillion. It has doubled in the decade since.
Eric Swanson, a professor of economics at the University of California and a former senior economist at the Federal Reserve, points to interest rates as the critical change. ‘What’s very different now compared to a decade ago is the level of interest rates,’ he says. ‘Long-term interest rates in the US are at multi-decade highs, part of that is concerns about inflation, but part of that is concerns about the extreme levels of US government borrowing.’ The bond market, he warns, is demanding higher returns, and investor appetite for US government bonds is ‘diminishing’, creating a ‘vicious’ cycle that requires ever-higher yields to keep buyers in the room.
Compounding the pressure, technology companies are borrowing large sums to fund artificial intelligence investment, competing directly with the government for the same pool of investor money and driving up the cost of that competition.
US National Debt $40 Trillion: What the Numbers Mean Day to Day
Mohamed A El-Erian, a professor at the Wharton School, puts the interest burden in stark terms. Interest payments on government debt are now 15% higher than the same period last year and are running at almost 20% of tax revenue, which he notes is ‘larger than defence’. His verdict on the overall situation: ‘We’re getting to a point where it’s a flashing yellow light. It’s not a flashing red light.’
That framing matters for ordinary Americans. El-Erian says households will likely face higher rates for mortgages, car loans and credit cards, with those on lower incomes hit hardest. There is also a secondary effect: when borrowing costs rise for companies, those costs tend to be passed on to consumers through higher prices. The impact, says Maya MacGuineas, president of the Committee for a Responsible Federal Budget, ‘finds its way to the pocketbooks of people one way or another’.
MacGuineas drew a vivid historical comparison. It took the United States almost 200 years to accumulate its first $1 trillion in debt, a milestone reached in 1981 that prompted President Ronald Reagan to address the nation on television. ‘Jumping to America’s 250th year,’ she said, ‘we are spending more than that just on interest payments on our debt.’
The generational dimension adds further weight. According to the Peter G. Peterson Foundation, debt held by the public already stood at 99% of GDP in 2025. By 2030, federal debt is projected to exceed the nation’s all-time high of 106% of GDP, a level last seen just after the Second World War. That record was set in circumstances of global conflict; reaching it again in peacetime is a different proposition.
The Congressional Budget Office forecasts debt climbing to around $64 trillion by 2036. Its economic projections, cited by the Peterson Foundation, show real GDP growth edging up from 2.0% in 2025 to 2.4% in 2026 before slowing to 1.8% through 2036, a rate that economists suggest may not be strong enough on its own to ease the debt burden. El-Erian acknowledges that with sufficient growth the problem eases, but without it, options narrow to tax reform, spending cuts, austerity or debt restructuring.
The US is also approaching its $41.1 trillion debt ceiling. A short-term attempt this week by the Treasury to buy back government debt and support bond demand had only a brief effect, with long-term borrowing costs rising again the following day.
Meanwhile, the legislative pipeline is pushing in the opposite direction. The Committee for a Responsible Federal Budget estimates that the One Big Beautiful Bill Act would add $4.2 trillion to the national debt through 2034, rising to $4.7 trillion through 2035 on a dynamic basis. El-Erian is candid about the political appetite for restraint: ‘I don’t see anything happening that is going to significantly lower the deficit over the next two to three years. If you look at the political talk, it’s about tax cuts.’ With that as the backdrop, the $40 trillion marker is unlikely to be the last one making headlines.
