Overview
- The Treasury reported on Wednesday that total public debt outstanding reached about $40.047 trillion, including roughly $32.3 trillion held by the public and $7.78 trillion in intra-governmental accounts.
- Markets reacted with higher long-term yields and lower demand for Treasuries, and Treasury Secretary Scott Bessent doubled planned buybacks of 10- to 30-year bonds to calm term premia.
- A recent Supreme Court ruling that voided parts of the administration’s tariffs required large tariff refunds and widened deficits, accelerating the recent rise in borrowing.
- Official forecasts show worsening fiscal trajectories: the CBO projects publicly held debt near 120% of GDP by 2036 and Social Security trustees warn the retirement trust fund may be exhausted in the early 2030s.
- Experts warn higher interest costs, now roughly or above $1 trillion a year, will crowd out spending, push up borrowing costs for households and businesses, and leave Congress facing politically hard choices on taxes, benefits, or spending.