The US Treasury Department’s fiscal year 2025 consolidated financial statements show a federal government with $6.06 trillion in total assets, $47.78 trillion in total liabilities, and a negative net position of $41.72 trillion, giving fresh ammunition to arguments that the US government is functionally insolvent.
Consolidated balance sheet position worsened by nearly $2.07 trillion from FY 2024 to FY 2025. Total liabilities now stand at nearly eight times reported assets. The largest balance-sheet drivers were a $2.0 trillion increase in federal debt and interest payable, which reached $30.33 trillion, and a $438.8 billion increase in federal employee and veteran benefits payable, which rose to $15.47 trillion.
The official liability total still does not capture the government’s largest long-term promises. Treasury discloses social insurance obligations separately, with the 75-year unfunded obligation climbing by $10.1 trillion in one year to $88.4 trillion in 2025 from $78.3 trillion in 2024.
Most of that jump came from healthcare and retirement programs. Projected Medicare Part B shortfalls increased by $6.9 trillion, while the Social Security shortfall rose by $2.5 trillion.
Putting the off-balance-sheet obligations together with the reported liabilities yields more than $136.2 trillion in total federal obligations, roughly five times annual US GDP.
It is worth noting that the Government Accountability Office issued a disclaimer of opinion on the FY 2025 financial statements, marking the 29th consecutive year it has been unable to determine whether the government’s consolidated statements are fairly presented. The stated reasons were persistent financial management failures at the Department of Defense and unresolved weaknesses in interagency accounting.
The policy response to the situation centers on two congressional actions. The Fiscal Commission Act, backed by Rep. Bill Huizenga, Rep. Scott Peters, and 41 co-sponsors, would establish a commission to evaluate fiscal trade-offs and deficit reduction options, while the House Resolution 15, sponsored by Rep. Jodey Arrington, which would call an Article V Convention limited to proposing a fiscal responsibility amendment to the Constitution.
That proposed amendment is modeled on Switzerland’s Debt Brake and would require a balanced budget over the business cycle while preventing federal spending from growing faster than the economy.
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