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The U.S. federal debt has for the first time crossed the symbolic threshold of 40 000 billion dollars, illustrating an acceleration of indebtedness that now places the interest bill among the United States’ top expenditures.
According to data from the U.S. Treasury Department, total public debt outstanding reached 40 047 billion dollars on August 18, 2026. It has thus more than doubled in less than ten years: when Donald Trump took office at the White House in January 2017, it stood at about 19 950 billion dollars.
Behind this spectacular threshold lies, however, a reality more complex than a simple counter: successive deficits, pandemic-related spending, aging of the population, social programs, fiscal choices and especially a rapid rise in interest costs are feeding simultaneously the trajectory of the American debt.
The Essentials
$40.047 trillion: the U.S. federal debt first crossed the 40 trillion-dollar threshold on August 18, 2026.
$32.266 trillion correspond to debt held by the public, about 101% of U.S. GDP in 2026.
$963 billion have already been allocated to interest over the first ten months of the 2026 fiscal year, versus about $763 billion in Department of Defense spending.
$2.100 trillion: this is the federal deficit expected for the entire 2026 fiscal year according to the latest projections.
By 2036: debt held by the public could reach 120% of GDP and net interest could exceed $2.144 trillion per year.
$32.266 trillion actually held by the public
The 40.047 trillion dollars figure corresponds to the gross federal debt.
It breaks down into two large categories.
The first, of about $32.266 trillion, consists of Treasury securities held by the public. They are held by American investors, banks and financial funds, the Federal Reserve, as well as foreign investors and governments.
The second represents about $7.782 trillion of intragovernmental debt: these are mainly Treasury securities held by federal funds and programs, notably funds related to Social Security.
To measure the weight of debt relative to the American economy, economists look more at debt held by the public than at the single eye-catching figure of 40,000 billion.
The Congressional Budget Office (CBO) estimated in February that this debt would represent about 101% of GDP in 2026 and could reach 120% in 2036, surpassing the previous post-World War II high.
Debt and deficit: two figures not to be confused
Debt is not the budget deficit.
The deficit is the shortfall created during a given period when the government spends more than it collects.
Debt, on the other hand, represents the accumulation of money borrowed over the years to finance these deficits and to honor already-made commitments.
Yet the United States continues to spend significantly more than it collects.
In the first ten months of the 2026 fiscal year, the federal deficit stood at about $1.8 trillion, or $169 billion more than in the same period of the previous year. Spending approached $6.2 trillion, against approximately $4.4 trillion in receipts.
The CBO subsequently raised its full-year deficit projection for 2026 to about $2.1 trillion, up from $1.9 trillion in its February projections. The revision reflects lower-than-expected customs revenues after changes in U.S. tariff policy.
Debt and deficit: the difference in one minute
The deficit is the shortfall created during a period when the government spends more than it collects. For 2026, it should approach $2.1 trillion.
Debt is the accumulation of borrowings over time to fund these deficits and other obligations. It now stands at $40.047 trillion.
| Benchmark | Amount / level | What to take away |
|---|---|---|
| January 2017 | $19,950 billion of debt | Level at the start of Donald Trump’s first term |
| FY 2020 | $3,100 billion deficit | Peak tied to the pandemic and extraordinary support measures |
| FY 2021 | $2,700 billion deficit | Second year of exceptional deficit after the health shock |
| August 18, 2026 | $40,047 billion of debt | First crossing of the $40 trillion threshold |
| FY 2026 | $2,100 billion deficit expected | The deficit continues to feed the rise in debt |
| 2026 | 101% of GDP | Debt held by the public relative to the size of the economy |
| Projection 2036 | 120% of GDP | Projected level of debt held by the public if the current trajectory continues |
Nearly $12 trillion of additional debt across Trump’s two administrations
The growth has crossed several administrations.
During Donald Trump’s first term, from January 2017 to January 2021, the federal debt rose by about $7.8 trillion.
Under Joe Biden, from January 2021 to January 2025, it progressed by about $8.4 trillion more.
Since Donald Trump returned to the White House in January 2025, another roughly $3.8 trillion has been added. The increase recorded over his two terms thus reaches about $11.6 trillion.
These amounts do not mean that every dollar of debt can be personally attributed to the sitting president: part of the spending stems from earlier laws, mandatory programs, and Congressional decisions.
The Covid-19 pandemic nonetheless represented a major break.
The federal budget deficit had jumped to $3,100 billion in 2020, then $2,700 billion in 2021, versus about $984 billion in 2019, due to the recession and especially the extraordinary programs adopted to support households, businesses and the economy.
Reuters estimates that around one-third of the increase in debt since January 2017 occurred during the two pandemic-response years.
$963 billion just for interest
The real dimension shift now lies in the cost of financing this debt.
During the first ten months of the 2026 fiscal year, net interest on the debt reached $963 billion, i.e., $117 billion more and a rise of 14% year over year.
For comparison, military spending by the Defense Department over the same period was about $763 billion.
Interest costs thus already far exceed ongoing military expenditures and have become one of the main budget lines of the federal budget. Reuters notes that it has also surpassed Medicare spending in the first ten months of the fiscal year to become the second major budget line, behind Social Security.
The phenomenon results from a double effect: the amount of debt is increasing and the rate at which Washington must borrow has risen.
The CBO estimates that net interest expenses could rise from a little over $1,000 billion in 2026 to $2,144 billion in 2036, i.e., more than doubling in ten years. They would then account for around 4.6% of the U.S. GDP.
Social Security and health: nearly $2.9 trillion
Social programs constitute the other major driver of spending.
In the first ten months of the 2026 fiscal year, the combined spending on Social Security, Medicare and Medicaid approached $2.9 trillion.
In comparable scope, their year-over-year growth stands at about $181 billion, driven notably by an increase in beneficiaries, higher benefits and rising costs of care.
American demographics render this trend structural: the aging of the Baby Boom generation progressively raises retirement and health expenses.
These programs are largely mandatory spending, meaning they cannot be cut as easily as some administrative budgets.
Around 60% of the roughly $7 trillion Washington spends annually is now devoted to these mandatory programs, according to Reuters data.
Receipts rise, but corporate tax falls
Over the first ten months of the year, federal receipts rose by about 3%.
This overall rise masks, however, a drop in corporate tax receipts. These fell to about $298 billion, a decline of 23%.
The CBO links part of this drop to new deductions granted to companies for certain investments under the Budget Reconciliation Law passed in 2025.
This law is one of the major factors shaping the U.S. budget trajectory.
In its February projections, the CBO estimated that the 2025 reconciliation law would boost cumulative deficits by about $4.7 trillion between 2026 and 2035, once its economic effects and additional debt service costs are accounted for.
At the time, higher tariffs were expected to offset part of this rise, to the tune of about $3,000 billion over the same period. But that estimate has since been undermined by court decisions and changes in U.S. tariff policy: the CBO has revised downward the expected tariff receipts and raised its deficit forecast for 2026.
The cost of debt begins to affect markets
The crossing of the $40 trillion mark also occurs in a context of tension in long-term U.S. Treasuries.
Long-term Treasury yields have reached their highest levels in nearly two decades, as investors demand higher compensation to absorb growing volumes of public debt.
Treasury Secretary Scott Bessent announced on August 19 a doubling of the amounts of some 10- to 30-year bond repurchases, up to at least $4 billion per operation, to improve market liquidity.
For American households, this development is not abstract: higher yields on government bonds can help keep higher interest rates on mortgages, auto loans, and business loans.
A trajectory deemed “unsustainable”
In June 2026, the Government Accountability Office (GAO), the U.S. public accounts watchdog, used an unequivocal term: the federal budget trajectory is “unsustainable”.
The agency estimates that, without policy changes, debt held by the public will grow much faster than the economy over the next decade. It emphasizes especially that interest is set to become the budget’s fastest-growing component.
The $40 trillion threshold is therefore largely symbolic. It does not mean the United States suddenly faces insolvency: the country remains capable of borrowing on markets and Treasuries continue to play a central role in the global financial system.
But the dynamics are increasingly constraining.
The more debt increases, the more interest consumes a portion of public receipts. The more these interest payments rise, the more they themselves fuel the deficit and require new borrowing.
So the figure to watch may not only be the $40,047 billion of debt.
It is the $963 billion already spent on interest in just ten months — and the more than $2.1 trillion per year that this bill could reach by 2036.
