Many posts have discussed federal deficits and the federal debt.
Zoom in: President Trump said in 2016 that he could eliminate what was then roughly $19 trillion in national debt within eight years. On Tuesday, the debt crossed $40 trillion, after growing by $3 trillion in the past year alone.About $32 trillion is owed to investors and other outside holders. The rest is debt the government owes to its own accounts, including Social Security and other federal trust funds.
Treasury must refinance $9.7 trillion in debt coming due this fiscal year while covering a deficit the Congressional Budget Office now projects at roughly $2.1 trillion.
That creates a punishing cycle: Old debt comes due, Washington replaces it with more expensive debt, and the resulting interest bill feeds future deficits.CBO projects annual deficits will average $2.4 trillion through 2036, pushing debt held by the public to 120% of GDP — above the record set after World War II.
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The big picture: America's debt burden is approaching the point where it starts reshaping household finances, presidential politics and the country's economic choices.Long-term Treasury yields have climbed to their highest levels since 2007, raising borrowing costs across the economy — from mortgages to business loans — and making Washington's own debt more expensive to refinance.
Social Security's retirement trust fund is projected to run dry in late 2032, during the final months of the next president's first term.
Medicare's hospital trust fund follows in the second quarter of 2033.
Between the lines: Trump and Elon Musk promised to break Washington's addiction to debt without forcing Americans to swallow painful sacrifices.Musk launched DOGE with ambitions of cutting as much as $2 trillion from federal spending. Its final public tally claimed just $215 billion in savings — barely a tenth of that goal.
A federal audit released this month found billions in unsupported or inaccurate savings claims, including $27.4 billion tied to contracts that were still active.