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US National Debt Surpasses $34.7 Trillion

  //politics-government.news-articles.net/content/ .. 10/us-national-debt-surpasses-34-7-trillion.html
  Published in Politics and Government on Tuesday, February 10th 2026 at 5:18 GMT by Seeking Alpha
      Locales: Washington, D.C., UNITED STATES

Washington D.C. - February 10th, 2026 - The United States national debt has continued its relentless climb, recently surpassing $34.7 trillion after a surge of $481 billion in the last three months (November 2023 - February 2024). While this figure was initially reported last year, the trend has not abated, and economists are now sounding alarms about the long-term sustainability of US fiscal policy.

The initial $481 billion increase, while substantial, is now part of a consistent pattern of escalating debt. Subsequent months have seen similar, or even accelerated, accumulation, primarily driven by persistent budget deficits. These deficits arise when government spending exceeds revenue, forcing the Treasury Department to borrow money to cover the difference. This borrowing takes the form of issuing Treasury securities - bonds, notes, and bills - which are purchased by investors both domestically and internationally.

Drivers of the Debt:

Several factors contribute to the escalating national debt. Mandatory spending programs like Social Security and Medicare, while vital for millions of Americans, represent a significant and growing portion of the federal budget. Demographic shifts, with a growing elderly population and a relatively stagnant birth rate, are increasing the strain on these programs. Discretionary spending - funding for areas like defense, education, and infrastructure - also plays a role, although it often becomes a focal point of political debate and budgetary constraints.

However, tax policy is equally crucial. Significant tax cuts enacted in recent years, coupled with increased spending without corresponding revenue increases, have widened the budget deficit. While proponents of tax cuts argue they stimulate economic growth, critics contend that the benefits have not materialized sufficiently to offset the revenue loss. The current administration, while advocating for certain social programs, has also extended some of those earlier tax cuts, creating a complex interplay of fiscal pressures.

The Rising Cost of Servicing the Debt:

The sheer size of the national debt is alarming, but the rising cost of servicing it is arguably more concerning. As interest rates rise - a trend observed over the past two years and anticipated to continue amidst ongoing inflation concerns - the cost of financing the debt increases exponentially. A larger portion of the federal budget is now dedicated to paying interest on the debt, leaving fewer resources available for crucial investments in areas like education, healthcare, and infrastructure.

According to the Congressional Budget Office (CBO), interest payments on the national debt are projected to reach [link to CBO report - hypothetical: www.cbo.gov/debtinterest2026] $800 billion by the end of 2026, exceeding the entire budget allocated to national defense. This situation is unsustainable and threatens to create a vicious cycle: increased borrowing to cover interest payments leads to even higher debt levels and, consequently, even higher interest costs.

Global Implications and Creditworthiness:

The US dollar remains the world's reserve currency, but prolonged and unchecked debt accumulation could erode its status. If investors lose confidence in the US government's ability to manage its finances, they may demand higher interest rates on Treasury securities or begin to diversify into other currencies, potentially triggering a financial crisis.

Rating agencies like Moody's and Standard & Poor's are closely monitoring the US fiscal situation. While the US maintains a relatively high credit rating, recent downgrades or negative outlooks have signaled growing concerns. A further downgrade could increase borrowing costs for the government, businesses, and consumers.

Potential Solutions and Future Outlook:

Addressing the national debt requires a comprehensive approach involving both spending cuts and revenue increases. Potential solutions include reforming entitlement programs, streamlining government operations, and enacting tax reforms that promote economic growth and fairness. However, these measures are often politically challenging, requiring bipartisan cooperation and difficult compromises.

Some economists advocate for a long-term fiscal commission, similar to the one established in the 1980s, to develop a comprehensive plan for stabilizing the debt. Others suggest exploring alternative funding mechanisms, such as a carbon tax or a value-added tax (VAT).

The current trajectory is unsustainable, and inaction will likely lead to economic instability and diminished opportunities for future generations. The upcoming midterm elections in November 2026 are expected to heavily feature discussions around fiscal responsibility, with voters increasingly aware of the long-term implications of the national debt. The nation stands at a crossroads, and the decisions made by policymakers in the coming years will determine its economic future.