Incorrect headlines say this is the first time since WWII. Not quite, counting Covid.
US Federal Debt Current Details
- Total: 39,065 trillion
- Debt Held by the Public: 34.431 trillion
- Debt Held by Foreign and International Investors: 9.248 trillion (2025 Q3)
- Inter-Agency Debt: 7.634 trillion
Numbers are quarterly from the St. Louis Fed except for the current quarter which is from Debt-to-the-Penny from the US Treasury as of March 31, 2026.
Intergovernmental Debt
Intergovernmental debt represents money the federal government owes to its own agencies, trust funds, and programs rather than to outside investors, banks, or foreign nations. As of 2025–2026, this debt totals over $7 trillion, primarily held by the Social Security Administration, federal employee retirement funds, and Medicare trust funds.
Economists ignore intergovernmental debt owed to itself. For the purpose of calculating debt-to-GDP, we use Debt Held by the Public.
The Rise of Debt Held by the Public
- Increase from 1970 to 1990: 2.157 trillion (20 years)
- Increase from 1990 to 2001: 0.901 trillion (11 years)
- Increase from 2001 to 2008: 1.995 trillion (7 years)
- Increase from 2008 to 2020: 11.890 trillion (12 years)
- Increase from 2020 to 2026: 14.207 trillion (6 years)
The above timeline roughly marks the start of recessions.
I believe you can spot a trajectory, time, and magnitude set of problems here.
US Federal Debt Percent of Nominal GDP
By my calculation, debt-to-GDP topped the 100 percent mark in the fourth quarter of 2025.
I see a lot of posts stating this is the first time since WWII. I have it as the third time since WWII.
For my calculation, I divided the latest quarterly debt numbers and divided by average of the latest 4 quarters of GDP.
US debt-to-GDP was 112.7 percent in WWII (106 percent for public debt). Total debt is now 125.15 percent of GDP.
Does anyone think we are going to have another baby boom to bail this out?
Let’s put everything together.
US Federal Public debt vs nominal GDP
Annual Interest Payments
Annual interest payments on U.S. public debt have officially surpassed $1 trillion, driven by rising interest rates and a debt exceeding $31 trillion, making it one of the fastest-growing federal budget components.
As of 2026, this cost exceeds annual defense spending and represents over 14% of government spending, a figure projected to grow to over $2 trillion by 2036.
Trump’s Promises
Recall that Trump promised to use tariff revenue to send $2,000 dividend checks, bail out farmers from the mess he made, and reduce national debt as well.
Trump keeps repeating his lies with no challenges from Republican Senators.
Occasionally Rand Paul will make a noise regarding levels of debt. But no one in either party is going to do a damn thing about any of this.
Republicans are only concerned about debt when Democrats are in control of the White House.
This will eventually blow up in a huge credit crisis, but no one can tell you when.
Meanwhile pressure on interest rates is up. This will increase the deficit and add to debt. And this is happening without even being in recession!
Related Posts
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April 30, 2026: PCE Inflation Is Ripping Higher. Don’t Expect Fed Interest Rate Cuts
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April 30, 2026: Offshore US Dollars Surge Over the $14 Trillion Mark, Where’s De-Dollarization?
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Article posted with permission from Mish Shedlock
