U.S. National Debt Passes $40 Trillion for the First Time

The U.S. national debt has passed $40 trillion for the first time. Treasury’s daily “Debt to the Penny” series shows total public debt outstanding of $40.047 trillion on Aug. 18, up from $39.987 trillion the previous business day. Of the total, about $32.27 trillion is held by the public and about $7.78 trillion is owed to government trust funds and other federal accounts.

The climb has been quick. Reuters, as carried by The Nation of Thailand, reported that debt passed $39 trillion less than five months before reaching $40 trillion. When President Trump first took office in January 2017, it stood at about $19.95 trillion, so it has roughly doubled in under a decade. Reuters said about a third of the increase came from pandemic-era borrowing under Trump and President Biden, with the rest reflecting both administrations’ fiscal policies and a long gap between revenue and spending.

Interest is now one of the biggest line items in the budget. According to Reuters, the government pays about $1.1 trillion a year in interest, which exceeded Defense Department spending for the first time in fiscal 2025 and, in the first ten months of fiscal 2026, surpassed Medicare, leaving it behind only Social Security.

Markets are paying attention. Reuters reported that a $25 billion auction of 30-year bonds this month drew the highest yield for such an auction since 2021, and that long-term Treasury yields have reached their highest level in almost 20 years. Foreign investors, who hold almost a third of U.S. government debt, have reduced their holdings over the past year. Treasury Secretary Scott Bessent has said buybacks of 10- to 30-year securities will be at least $4 billion per operation.

News 1st of Sri Lanka, citing the BBC and Reuters, reported that the Congressional Budget Office had expected debt to reach $39.6 trillion only by the end of fiscal 2026, and that the government is nearing its $41.1 trillion debt ceiling. The CBO projects debt of about $64 trillion by 2036, News 1st said.

Budget watchdogs warn that the trajectory limits the government’s options. Maya MacGuineas of the Committee for a Responsible Federal Budget warned that the figure is more than a number on the government’s accounts, pointing to inflationary pressure and less room to respond to emergencies, according to Reuters’ paraphrase of her remarks. The Congressional Budget Office estimates that the One Big Beautiful Bill Act, the tax and spending law signed last year, will add $4.7 trillion to the debt.

Bessent has said the Treasury will buy back longer-dated securities in regular operations. The Treasury figures themselves settle no argument over taxes or spending: they show only that borrowing has outrun revenue.