As of May 2026, the US national debt has crossed the $38 trillion mark, with debt held by the public surpassing $31trillion, according to the US Congress Joint Economic Committee.

This surge — driven by structural deficits, entitlement spending, and high interest costs — has pushed total debt above 100% of the entire American economy. This is the first time since World War II that the US debt has exceeded its GDP.

This concerning development has sparked a debate among economists, investors, and policymakers. Fiscal conservatives warn that the US is drifting toward an unsustainable economic future characterised by rising interest costs, slower growth, and mounting risks of a financial crisis. Others, however, argue that while the debt trajectory is worrying, America still possesses unique economic strengths that make catastrophe unlikely — at least in the near future.

Both projections may be overstated. The reality likely falls somewhere in between.

The federal borrowing has swelled dramatically since the 2008 global financial crisis, when debt held by the public stood at roughly $5 trillion. Since then, frequent rounds of deficit spending, tax cuts, stimulus packages, rising healthcare costs, and demographic pressures have pushed borrowing to historic highs.

The trend was further accelerated by the COVID-19 pandemic, which triggered lockdowns and economic recession. The US administration sought to stabilise the economy with massive emergency spending, but it also added trillions to the balance sheet in just a few years.

Unlike World War II, the current debt buildup points to a systemic problem, one defined by deeper structural imbalances between federal revenues and spending. The biggest drivers, according to some analysts, are Medicare........

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