US hits $38 trillion in debt, after the fastest accumulation of $1
trillion outside of the pandemic
[October 23, 2025]
By FATIMA HUSSEIN
WASHINGTON (AP) — In the midst of a federal government shutdown, the
U.S. government’s gross national debt surpassed $38 trillion Wednesday,
a record number that highlights the accelerating accumulation of debt on
America’s balance sheet.
It's also the fastest accumulation of a trillion dollars in debt outside
of the COVID-19 pandemic — the U.S. hit $37 trillion in gross national
debt in August this year.
The $38 trillion update is found in the latest Treasury Department
report, which logs the nation’s daily finances.
Kent Smetters of the University of Pennsylvania’s Penn Wharton Budget
Model, who served in President George W. Bush’s Treasury Department,
told The Associated Press that a growing debt load over time leads
ultimately to higher inflation, eroding Americans' purchasing power.
The Government Accountability Office outlines some of the impacts of
rising government debt on Americans — including higher borrowing costs
for things like mortgages and cars, lower wages from businesses having
less money available to invest, and more expensive goods and services.
“I think a lot of people want to know that their kids and grandkids are
going to be in good, decent shape in the future — that they will be able
to afford a house,” Smetters said. “That additional inflation compounds"
and erodes consumers' purchasing power, he said, making it less possible
for future generations to achieve home ownership goals.
The Trump administration says its policies are helping to slow
government spending and will shrink the nation’s massive deficit. A new
analysis by Treasury Department officials states that from April to
September, the cumulative deficit totaled $468 billion. In a post on X
Wednesday, Treasury Secretary Scott Bessent said that's the lowest
reading since 2019.
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Treasury Secretary Scott Bessent speaks with reporters at the White
House, Wednesday, Oct. 22, 2025, in Washington. (AP Photo/Evan Vucci)
“During his first eight months in office, President Trump has
reduced the deficit by $350 billion compared to the same period in
2024 by cutting spending and boosting revenue," White House
spokesman Kush Desai said in a statement, adding that the
administration would pursue robust economic growth, lower inflation,
tariff revenue, lower borrowing costs and cuts to waste, fraud and
abuse.
The Joint Economic Committee estimates that the total national debt
has grown by $69,713.82 per second for the past year.
Michael Peterson, chair and CEO of the Peter G. Peterson Foundation,
said in a statement that “reaching $38 trillion in debt during a
government shutdown is the latest troubling sign that lawmakers are
not meeting their basic fiscal duties."
“Along with increasing debt, you get higher interest costs, which
are now the fastest growing part of the budget," Peterson added. “We
spent $4 trillion on interest over the last decade, but will spend
$14 trillion in the next ten years. Interest costs crowd out
important public and private investments in our future, harming the
economy for every American.”
The U.S. hit $34 trillion in debt in January 2024, $35 trillion in
July 2024 and $36 trillion in November 2024.
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