US Public Debt Climbs Above $40 Trillion for the First Time

Summary

Bloomberg's Tyler Kendall reports that US public debt has surpassed $40 trillion for the first time. The Treasury plans to at least double buybacks of 10- to 30-year debt to lower long-term bond yields. Large deficits, rising health and Social Security costs, and higher debt-servicing costs are working against that goal. The fiscal backdrop is intensifying as Washington considers tax cuts and more defense spending.

• US public debt reached $40.05 trillion, up about a third in less than five years.
• Treasury says it will at least double planned buybacks of 10- to 30-year debt.
• Treasury Secretary Scott Bessent wants lower long-term bond yields to reduce mortgage and borrowing costs.
• Large US deficits and election-year spending politics have limited the impact of buybacks.
• July posted a record budget deficit fueled by health care and Social Security costs.
• Federal debt interest costs rose 15% year to date.
• The White House is floating new tax cuts while seeking higher defense spending.