Interestingly, just 37 days after President Donald Trump signed his “Big Beautiful Bill” (BBB), the national debt reached a new record at $37 trillion.
For debt nerds that amounts to about 120% of U.S. annual GDP, an historically high ratio but not the highest. The high came in March 2021 when it reached 130.4% of GDP as spending and collections were impacted by Covid. The ratio first passed 100% in 2013.
The BBB increased the national debt limit to $41.1 trillion. But that debt limit may not be sufficient for long.
A little history:
Three decades ago Speaker of the House Newt Gingrich led a GOP revolution to balance the budget as part of his “contract for America.” Sen. Roger Wicker, then in the House, was in on it. Back then, in 1994, the debt totaled $4.7 trillion.
The debt did not increase from 1998 through 2001 as the economy boomed, 1993 tax increases filled federal coffers, and defense spending declined as the Cold War ended. Then came President George W. Bush’s unpaid for war in Iraq. By July 2009 when Sen. Mitch McConnell proclaimed the national debt "threatens our way of life," the debt had resumed climbing and hit $10.6 trillion.
In 2012, the bipartisan National Commission on Fiscal Responsibility and Reform developed a plan to raise taxes and control spending but it was scuttled by the Republican members. That year the debt hit $16.1 trillion.
In 2016, when he first took office, President Trump promised to balance the budget and eliminate the national debt. At that time the debt was $19 trillion.
Since then under both Republican and Democratic leadership, as congressional acts that provide for sequestration and/or automatic cuts got waived year after year, the debt has almost doubled from $19 trillion to $37 trillion.
Helping to push annual deficits and the total debt level up are rising interest rates – the average rate on the debt more than doubled from January 2022 to July 2025. That interest, projected at $952 billion this fiscal year, is surpassing annual spending on both national defense and Medicare.
This is one reason President Trump pushes so hard on the Federal Reserve to lower rates. Of course, lower rates alone would not stop the debt hemorrhaging as experienced from 2008 to 2015 and 2020 to 2022 when the Fed kept its federal funds rate near zero.
The ever-growing debt and its surging interest costs are hijacking federal spending. Yet the President and the republican-controlled congress continue to imagine that the sacred political mantra of actual tax cuts and pretend spending cuts can turn that around.
“For all is vanity” – Ecclesiastes 3:19.
Bill Crawford is the author of A Republican’s Lament: Mississippi Needs Good Government Conservatives.
