The US national debt crossed $39 trillion on Wednesday, setting a new record less than three weeks into the US-Israeli war on Iran and sharpening questions about the administration’s ability to balance wartime spending with its pledge to reduce the deficit.
The debt reached $38 trillion in October 2025. The Committee for a Responsible Federal Budget confirmed the new milestone, with debt held by the public now exceeding $31 trillion.
Maya MacGuineas, the group’s president, called the crossing “an embarrassing milestone that both parties have helped build over decades, and neither seems particularly interested in addressing.”
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White House economic adviser Kevin Hassett estimated last Sunday that the Iran conflict has already cost the US more than $12 billion. The Pentagon separately asked the White House to approve a supplemental war funding request of more than $200 billion to Congress, according to the Washington Post. No end to the conflict is currently in sight.
The administration’s fiscal year 2025 numbers, sourced from the Treasury’s Fiscal Data website, show total government spending of $7.01 trillion against $5.23 trillion in revenue — a deficit of $1.78 trillion, down $41 billion from the prior year.
White House spokesman Kush Desai credited a “government right-sizing push that has reduced federal employment to its lowest level since 1966” for the improvement. He did not address the new debt milestone directly.
Fiscal watchdogs warn the trajectory is unsustainable. “At the current growth rate, we will hit a staggering $40 trillion in national debt before this fall’s elections,” said a spokesperson for the Peter G. Peterson Foundation. “Borrowing trillion after trillion at this rapid pace with no plan in place is the definition of unsustainable.”
The Government Accountability Office flags that rising debt levels translate directly into higher borrowing costs for Americans — pushing up mortgage rates, car loans, and the prices of goods and services as businesses face tighter capital conditions.
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