The exact figure is $40,047,425,768,420. That is what the U.S. government owed as of Tuesday, according to the Treasury Department’s daily report, and it is the first time gross federal debt has crossed $40 trillion.
Bond investors have already started charging for it. The yield on 30-year Treasuries has climbed to 5.3%, the highest since 2007. Part of the pressure comes from doubts that the Trump administration can hold down inflation and shrink the deficit. Part comes from the rush into artificial intelligence, which has big tech companies borrowing more.
Where the deficit came from
The shortfall has widened since Donald Trump returned to office. Spending jumped because of the war with Iran. Revenue slipped, thanks to tariff refunds and the business and high-income tax cuts in the One Big Beautiful Bill Act. The deficit is expected to top $2 trillion this year, close to 6% of GDP.
Trump does not carry all of it alone. Debt also climbed fast under Joe Biden, whose Covid-era spending and investment programs, and the inflation that followed, added to the borrowing.
The gross number is also not the one most analysts use. It includes about $7.7 trillion owed to federal trust funds and other government accounts. Debt held by investors stands at $37.64 trillion, or 99% of GDP. Gross debt is 124% of GDP, the highest since at least World War II.
The interest bill
Servicing the debt is expected to cost $1.4 trillion this year. Within two years, interest is projected to pass Social Security as the largest single item in the federal budget.
Maya MacGuineas, president of the nonpartisan Committee for a Responsible Federal Budget, said the number reaches well beyond the Treasury’s books. “Forty trillion of debt doesn’t exist solely on the government’s ledgers; it is felt throughout the economy and finds its way to the pocketbooks of people one way or another,” she said. “The more we borrow, the more we exacerbate inflation, squeeze out other priorities in the budget, and leave ourselves vulnerable to emergencies at home and turmoil abroad.”
Treasury Secretary Scott Bessent responded on Wednesday by announcing he would double Treasury buybacks in secondary markets. The aim is to add liquidity and pull borrowing costs down, since those costs work their way into mortgage rates and car and student loan rates.
Trump, meanwhile, has spent months leaning on the Federal Reserve to cut rates. On Wednesday he aimed his complaint at Fed Chair Kevin Warsh. “Every time we do great, we announce great numbers and the interest rates go up,” he told reporters. “And they go up because they want to stop inflation. They should go down because the country’s strong.”
The Congressional Budget Office warned in February that the path is not sustainable. “From 2026 to 2036, large and growing deficits cause debt to increase,” its report said. Debt held by the public rises from 101% of GDP this year to 120% in 2036, past the previous high of 106% set in 1946.
