The U.S. national debt surpassed $35 trillion for the first time in the nation's history on Monday as the federal government continues to accumulate debt at a record-setting pace.
New data from the Treasury Department released Monday afternoon showed that the gross national debt hit $35,001,278,179,208.67.
The milestone comes just months after the U.S. eclipsed the $34 trillion threshold in early January 2024, while the $33 trillion mark was reached in September 2023. By comparison, the national debt hovered around $907 billion just four decades ago.
"The United States rang in the new year with our gross national debt topping $34 trillion – now, just seven months later, we’ve added another trillion-dollar notch," Maya MacGuineas, president of the nonpartisan Committee for a Responsible Federal Budget, told FOX Business.
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"We’re seeing the effects of reckless borrowing in real-time with interest on that debt surpassing defense and Medicare this year and debt on course to reach a record share of the economy in just a few years," MacGuineas added. "But until our elected leaders start getting serious about our out-of-control debt situation, particularly by actually addressing the looming insolvency of our major trust funds, we’ll be having this same conversation in another few months."
The U.S. topping $35 trillion in total debt comes as the debt held by the public – a metric favored by economists that excludes debt held in intragovernmental accounts like the Social Security trust funds – is projected to reach 99% of the size of the U.S. gross domestic product this year.
The nonpartisan Congressional Budget Office (CBO) has projected the debt held by the public will reach a record level of more than 106% of GDP in 2027, breaking a nearly 80-year-old record set in 1946 when the U.S. was in the midst of the post-World War II demobilization. From there, the debt-to-GDP ratio is projected to surge in the decades to come.
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Federal budget deficits have widened in the last few years amid the rise in interest rates, which increases the net interest costs incurred by servicing the outstanding debt. Mandatory spending programs including Social Security and Medicare have exacerbated that trend, with the safety net programs facing rising costs amid the aging of America's population.
This year the federal government is projected to run a $1.9 trillion budget deficit, according to the latest estimate by the CBO.
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That would be $200 billion larger than last year's deficit, while the CBO's latest estimate for the current year is about $408 billion larger than an estimate published in February.
A $1.9 trillion deficit would rank as the third largest in U.S. history, trailing only the $3.1 trillion deficit incurred in fiscal year 2020 and the $2.7 trillion deficit in fiscal year 2021 that occurred during the peak of federal spending on pandemic-era relief programs.
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Congress and the winner of this year's presidential election will face a series of fiscal deadlines next year. The first will arrive on January 1 with the current suspension of the debt limit set to expire, which will force lawmakers to debate another increase or suspension of the debt ceiling and potentially fiscal reforms while the Treasury Department uses "extraordinary measures" to avoid a default for a period of several months.
