US national debt surpasses $37 trillion, marking a historic milestone

For the first time in US history, the nation’s gross national debt has exceeded $37 trillion, according to a new report from the US Treasury Department. The national debt stood at $37,004,817,625,842.56 on the afternoon of August 12, a stark reminder of the accelerating pace at which the US government is borrowing. This milestone was reached less than eight months after the country hit the $36 trillion mark in November 2024 and just over a year after surpassing $35 trillion in July 2024.

The speed of this debt accumulation has raised alarms among economists and fiscal experts. Michael Peterson, CEO of the Peter G. Peterson Foundation, told AP that the US is now adding $1 trillion to its national debt every five months, a rate more than twice as fast as the average pace over the last quarter-century. This rapid growth is primarily attributed to pandemic-related spending and recent tax cuts and government spending approved by Congress earlier this year under the Trump administration.

Impact on the economy and future generations

The surge in national debt has broad implications for the US economy. As the federal government borrows more, interest rates are pushed higher, raising borrowing costs for everyday Americans on mortgages, car loans, and credit cards. Additionally, businesses face higher borrowing costs, leading to reduced investment and potentially lower wages. The Government Accountability Office has also warned that rising debt could lead to more expensive goods and services. Some experts highlighted the long-term consequences of the Republicans’ tax law, which is expected to add $4.1 trillion to the debt over the next decade.

Policymakers urged to act before crisis hits

Maya MacGuineas, President of the Committee for a Responsible Federal Budget (CRFB), urged policymakers to take immediate action to tackle the growing debt. “This milestone should serve as a wake-up call for lawmakers,” she told AP. “We’re on track to spend $1 trillion just on interest costs. The fiscal situation is unsustainable.” Despite the grim reality, experts emphasise that it’s not too late for reform. However, with debt now greater than the combined economies of the Eurozone and China, the window for meaningful action is closing rapidly.

(With inputs from agencies)