US debt crosses $40 trillion as borrowing accelerates under Trump, Biden

US government debt has surpassed $40 trillion for the first time, according to the Treasury Department, highlighting mounting pressure on Washington as spending on social programmes and interest payments continues to outpace federal revenues.

The Treasury’s latest figures showed total public debt at $40.047 trillion, including about $32.27 trillion held by the public and $7.78 trillion in intragovernmental holdings, Caliber.Az reports per foreign media.

The milestone comes less than five months after debt crossed $39 trillion and marks more than a doubling since Donald Trump first took office in January 2017, when the debt stood at about $19.95 trillion. Roughly one-third of the increase accumulated during the massive borrowing undertaken by Trump and former President Joe Biden to fund the COVID-19 response.

Debt increased by about $7.8 trillion during Trump’s first term and by another $8.4 trillion under Biden, whose administration combined pandemic recovery spending with major investments in infrastructure, clean energy and other programmes. Since Trump returned to office in January 2025, the debt has risen by another $3.8 trillion, bringing the increase across his two terms to roughly $11.6 trillion.

The growing debt burden is being compounded by higher borrowing costs. The US government is now spending about $1.1 trillion a year on interest payments. Debt-service costs surpassed Pentagon spending in fiscal 2025 and, during the first 10 months of fiscal 2026, exceeded Medicare spending to become the second-largest federal budget item after Social Security.

At the same time, spending on Social Security, Medicare, Medicaid and veterans’ care continues to rise, while tax revenues have struggled to keep pace. Trump’s second-term One Big Beautiful Bill Act is projected by the Congressional Budget Office to add another $4.7 trillion to federal debt.

The debt milestone also comes as investors demand higher returns on longer-term US government bonds. The yield on the 30-year Treasury recently reached its highest level since 2007, while foreign investors, who hold nearly one-third of US Treasury securities, have reduced their holdings over the past year.

Higher Treasury yields can push up borrowing costs for households and businesses, including mortgages, car loans and commercial credit. Treasury Secretary Scott Bessent has responded by doubling the size of certain buyback operations for 10- to 30-year Treasury securities to at least $4 billion per operation.

Trump has continued to call for lower interest rates and said he was not concerned about recent bond-market volatility, arguing that a strong US economy should lead to lower borrowing costs.

Budget watchdogs have warned that the country's fiscal trajectory is becoming increasingly difficult to sustain without measures to raise revenues, reduce spending or both.

Rising healthcare and retirement costs are expected to add further pressure as the large baby-boom generation ages, while the government continues to spend significantly more than it collects in revenue.

By Aghakazim Guliyev