Federal debt reaches 124% of GDP, doubling in a decade and surpassing all budget categories except Social Security and Medicare.
The US national debt exceeded $40 trillion in August, marking a historic high at 124% of GDP. This compares to 62% in 2006 and reflects a 376% increase over 20 years. Interest payments now consume more of the federal budget than any other category except Social Security and Medicare.
The debt has more than doubled in the past decade, with the fiscal 2026 deficit already at $1.8 trillion through 10 months. Efforts to curb spending, including a government efficiency initiative led by Elon Musk, have failed to reverse the trend.
Historical patterns suggest rising debt levels may influence stock market performance, though the immediate impact remains uncertain.