Federal debt held by the public reached $31.26tn in March, above nominal GDP of $31.21tn over the 12 months ending in March.
Economists warn persistent deficits, higher interest costs and an ageing population are worsening fiscal strains, while Republicans have made limited spending cuts despite controlling Congress.
The debt-to-GDP crossover has previously occurred only briefly during the pandemic and after World War Two, and analysts say Donald Trump's tax cuts could add more than $3tn further.
As U.S. debt surpasses its economic output, is the dollar's global dominance facing its ultimate test?
With interest costs on the debt now exceeding $1 trillion, what future investments are we choosing to sacrifice?
Breaking: U.S. Public Debt Tops Economy Size in 2026, Signaling Fiscal Crisis Ahead
Overview
In March 2026, the U.S. national debt held by the public surpassed the entire economy's size, reaching $31.27 trillion against a GDP of $31.22 trillion, pushing the debt-to-GDP ratio just over 100%. This milestone resulted from major tax cuts reducing revenue, rising mandatory spending on Social Security and Medicare due to an aging population, and soaring interest payments on existing debt. The high debt level triggered concerns about economic risks, including reduced funding for infrastructure and defense, higher interest rates for households, and slower economic growth. These effects worsen the debt outlook, with projections showing debt could reach 120% of GDP by 2036 and 172% by 2055, alongside sharply rising interest costs.