Debt held by the public tops the size of the U.S. economy for fiscal 2026

Debt held by the public has topped the size of the entire U.S. economy for fiscal 2026, according to new data from the Bureau of Economic Analysis, the government's main economic scorekeeper ¹. The Hill reported the finding on Friday, four days before the Nov. 3 midterm election.

The Hill said economic output, known as gross domestic product or GDP, was more than $32.2 trillion from the fourth quarter of 2025 through the third quarter of this year ¹. Debt held by the public was more than $32.4 trillion on Sept. 30, according to the Treasury Department ¹. That is money the government owes to outsiders such as banks, state and local governments and foreign nations ¹.

The bigger number

The total national debt also counts what the government owes to itself. It stood above $40.5 trillion as of Wednesday ¹. It first crossed $40 trillion in August ¹. It was about $5.7 trillion at the turn of the century and $36.2 trillion when President Trump began his second term ¹.

The Hill said the ratio of debt to GDP for fiscal 2026 came in a little below the 101 percent that the nonpartisan Congressional Budget Office (CBO) projected in February ¹. But the CBO expects the ratio to reach 120 percent in 2036 ¹. That would pass the record of 106 percent set in 1946, just after World War II ¹.

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Interest and the Iran war

NPR reported in August that the government spends more than $1 trillion a year on interest. That makes interest its second-largest expense, behind Social Security ². Interest costs in the first 10 months of this fiscal year were 15 percent higher than a year earlier, NPR said ².

The Hill said rising debt and uncertainty over the Iran war have pushed bond yields up this year, which raises borrowing costs for Americans ¹. The 30-year Treasury yield was near 5.31 percent late Friday afternoon, about 68 basis points higher than the day before the war began ¹. A basis point is one-hundredth of a percentage point. The 10-year yield is more than 90 basis points higher than before the war ¹.

The CBO projected in February that the One Big Beautiful Bill Act, which Trump signed in July 2025, will add $4.7 trillion to the debt through 2035 ¹. The law also raised the legal debt limit to $41 trillion from $36 trillion ¹.

Who said what

In August, Margaret Spellings of the Bipartisan Policy Center called the situation unsustainable ². Carolyn Bourdeaux, executive director of Concord Action, said neither Congress nor the president has a credible plan to slow the growth of debt ².

Our current fiscal trajectory is plainly unsustainable, and that's the best-case scenario,

White House spokesman Kush Desai answered with a statement blaming the previous administration ².

President Trump pledged to clean up Joe Biden's fiscal mismanagement,

Both the CBO's February projections and this week's data cover a period in which Republicans control the White House and both chambers of Congress. Voters will weigh that on Tuesday.

The Record

1. Jul 1, 2025Trump signs the One Big Beautiful Bill Act, which the CBO projects will add $4.7 trillion to the debt through 2035 and which raises the debt limit to $41 trillion ¹.
2. Aug 19, 2026Total federal debt passes $40 trillion, according to Treasury data ².
3. Oct 30, 2026BEA data show debt held by the public topped GDP for fiscal 2026, and total debt is above $40.5 trillion ¹.

Sources

1. The Hill, “Federal debt surpassed GDP for fiscal 2026” (2026-10-30). thehill.com/business/6185236-federal-debt-gdp-bea-cbo-treasu
2. NPR (via Michigan Public), “The U.S. debt tops a record-shattering $40 trillion. Yes, with a T” (2026-08-19). michiganpublic.org/2026-08-19/the-u-s-debt-tops-a-record-sha

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