America’s $31 trillion national debt has now exceeded its annual economic output, new government numbers show, a milestone that critics say is a crisis point for the country.
The United States has crossed the 100% debt-to-GDP ratio previously, but economists do not expect it to fall back below that threshold — marking the moment the national debt became, in all likelihood, permanently larger than the economy.
So far, there are no serious efforts underway in Washington to make major changes.
On the campaign trail in both 2016 and 2024, Donald Trump pledged to reduce the national debt — in 2016, Trump said he’d get rid of it in eight years. White House spokesperson Kush Desai told NOTUS on Thursday that the president is holding to his promise.
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“President Trump pledged to slash the pervasive waste, fraud and abuse in federal spending, and from terminating asinine DEI ‘research’ grants to cracking down on Medicaid fraudsters, the Trump administration is delivering on this pledge every day,” Desai said.
Desai added that the “federal budget deficit decreased by over 20 percent in President Trump’s first full year in office compared to the same time period the year before,” pointing to data from the Federal Reserve Bank of St. Louis which indicates that the deficit shrank 17.8% compared to the year prior.
The Congressional Budget Office reports that the federal budget deficit decreased by 2% in fiscal year 2025 compared to the year before. At $1.8 trillion, it is still one of the highest budget deficits ever.
“I think everybody knows the need to do more,” Republican Rep. Randy Fine said.
“But it’s one of those problems — it’s easy to say next time, later, later, because it’s going to be painful to do.”
Most Republicans NOTUS spoke to acknowledged the severity of the problem, but few were able to point to substantive efforts underway to raise revenue or get serious about cutting spending. Fine said he was pushing to end all social services to undocumented immigrants, but even the most aggressive estimates highlighted by Republicans of spending on noncitizens would hardly make a dent.
Some Republicans pointed to the One Big Beautiful Bill Act, which cut spending on programs like the Supplemental Nutrition Assistance Program and Medicaid. But the bill also extended the 2017 Tax Cuts and Jobs Act tax cuts and cut taxes further, like on tips and overtime.
“You have people who talk about debt and deficits as only a spending problem on certain programs,” Gbenga Ajilore, the chief economist with the Center on Budget and Policy Priorities, a progressive think tank, told NOTUS. “So when they talk about, ‘We need to curb our spending, we need to be physically tight,’ it’s always on the backs of low- and medium-income people.”
The debt increase has been driven by a number of factors — decades of tax cuts, increased spending in areas like defense and an aging population that contributes to increased mandatory spending on social programs.
The United States has been in this situation before, most recently during the COVID-19 pandemic and during World War II, when the debt-to-GDP ratio was its highest. But unlike those instances, economists do not anticipate the ratio falling much further below 100% again; the Congressional Budget Office estimates that by 2036, the federal debt will be 120% of GDP.
“We have to get serious about this,” Republican Sen. Rand Paul told NOTUS. “There is every indication that we are facing a crisis. We have to get serious and we have to cut spending.”
“It’s bad,” Sen. Josh Hawley, another Republican, said. “I think it’s a sign of terrible stewardship on the part of Congress for not just one or two years but for decades now. There’s a lot of work to be done there.”
But the work of moving aggressively to cut spending or raise revenue does not appear to be progressing.
Congress is currently pushing to spend $400 million to aid the construction of a ballroom on the White House grounds, which Trump previously said would be paid for with taxpayer dollars. Some Republicans like Sen. Rick Scott balked at this — “We have $39 trillion in debt,” he said, using the total debt that includes money the government owes itself.
Experts say cutting anything is a start.
“How do you get out of a hole?” Ajilore said. “Well, the first thing you need to do is stop digging.”
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