At the beginning of Trump’s first presidential term in 2016, US national debt stood at just under $20tn. It has doubled in the decade since.
The figure is rising by about $90,000 every second, or $7.8bn a day, according to the Congress Joint Economic Committee.
“What’s very different now compared to a decade ago is the level of interest rates,” says Eric Swanson, professor of economics at University of California and former senior economist at the Federal Reserve.
“Long-term interest rates in the US are at multi-decade highs – part of that is concerns about inflation, but part of that is concerns about the extreme levels of US government borrowing.”
The bond market is demanding higher returns with investors wary of the scale of the US’s debt, but also because tech firms borrowing eye-watering sums to spend on AI are competing with the government for investors’ cash.
“What happens when interest rates go up is that the funding of the deficit becomes more expensive,” says economist Mohamed A El-Erian, a professor at the Wharton School.
Interest payments on government debt are now 15% higher than the same period last year, says El-Erian. They are almost 20% of tax revenue, which is “larger than defence”, he adds.