WASHINGTON, September 22 — The US national debt has not reached $40 trillion, and top economists say that number is not what is driving Treasury Secretary Scott Bessent’s bond-market strategy. The bottom line: the $40 trillion figure is a distraction, and the economists pushing back on it say the real issue sits elsewhere — in how the Treasury issues debt, how auctions perform, and what it costs to service what is already outstanding.
By the numbers, the debt crossed $30 trillion in February 2022 and $35 trillion in July 2024, according to Treasury Department data. It has been rising for decades.
It has not hit $40 trillion. Bessent has not cited that threshold as a trigger for his plan.
What would make Bessent flinch
In public remarks, Bessent has signaled the conditions that would force his hand. A disorderly selloff in the Treasury market. A sharp rise in yields that disrupts borrowing costs across the economy.
Weak demand at Treasury auctions. He has emphasized the importance of regular and predictable issuance, and he has warned against politicizing the debt limit — the maximum amount the government can borrow, which has been suspended or raised numerous times, most recently in 2023.
Bessent was confirmed as Treasury Secretary in January 2025. He previously ran Key Square Group, a macro hedge fund, and was a partner at Soros Fund Management.
The servicing cost, not the headline
Economists quoted in the story say the $40 trillion figure is a distraction. The real issue, they argue, is the trajectory of debt as a share of GDP, which is at levels not seen since World War II. The Congressional Budget Office projects that federal debt held by the public will reach 118% of GDP by 2035.
Bessent’s bond plan involves adjusting the maturity profile of Treasury issuance, potentially shifting toward more longer-term debt to lock in rates. Economists caution that such moves carry risks.
The US national debt is the total amount of money the federal government has borrowed to cover its obligations. That definition matters here, because the debate over Bessent’s strategy has settled on the mechanics of issuance and the cost of servicing existing debt rather than on any single round number. Investors will note that the story is anchored to a developing news cycle in which economists are pushing back on the $40 trillion narrative.
It relies on Bessent’s past public statements and established economic data, not on new remarks from the Treasury Secretary. What to watch next: whether auction demand holds, whether yields stay orderly, and whether the debt-limit debate stays clear of the issuance calendar.
Those are the variables Bessent himself has named.
