Introduction
The U.S. national debt is one of the most discussed topics in global finance. As of May 5, 2025, the total gross national debt of the United States stands at $36.21 trillion. This article explains what that means, how it has grown, and what it could mean for the future of the U.S. economy.
What Is the National Debt?
The national debt is the total amount of money the U.S. federal government owes to creditors. It is made up of two main parts:
Debt Held by the Public: $28.90 trillion
(Money borrowed from investors, foreign governments, and other entities)
Intragovernmental Holdings: $7.31 trillion
(Money the government owes to itself, like Social Security and other trust funds)
How Fast Is the Debt Growing?
One-Year Growth
Over the past year alone, the national debt has grown by $1.66 trillion. That means:
$4.54 billion added every day
$188.98 million every hour
$3.15 million every minute
$52,493.44 every second
Per Person and Per Household
This increase equals:
$4,892.55 per U.S. citizen
$12,589.28 per U.S. household
Currently, the total debt per person is $106,442, and per household is $273,891.
Five-Year Growth
Compared to five years ago, the total debt has increased by $11.15 trillion.
Future Projections
If the debt keeps growing at the same average rate seen over the past three years, the U.S. is expected to hit:
$37 trillion by September 30, 2025
Add another $1 trillion in approximately 188 days
This projection assumes no major policy changes or economic shocks.
U.S. Debt and Interest Rates
Types of Debt
The government issues debt mainly through Treasury securities, which include:
Bills (4–52 weeks)
Notes (2–10 years)
Bonds (20–30 years)
Others: TIPS (inflation-protected), Floating Rate Notes, etc.
Interest Payments
As of April 2025, the average interest rate on marketable debt is 3.354%:
Up from 3.297% one year ago
Up from 1.964% five years ago
The U.S. paid $241.55 billion in interest to trust funds in the past year, or about $20.13 billion per month.
Future Interest Burden
According to the Congressional Budget Office (CBO):
Net interest will be 13.55% of government spending in FY2025
Rising to 14.11% by FY2027
This means more of the federal budget will go toward interest payments rather than public services.
Composition of U.S. Debt
As of April 2025, public debt distribution is:
Security Type Amount (Trillions) Share (%)
Notes $14.90 (51.65%)
Bills $6.06 (21.00%)
Bonds $4.95 (17.15%)
Others $2.94 (10.20%)
Investor Demand: Bid-to-Cover Ratio
The bid-to-cover ratio shows how many times over investors are willing to buy U.S. Treasury debt:
4-week Bills: 2.74
10-year Notes: 2.60
30-year Bonds: 2.33
A ratio above 2 is considered healthy, showing strong investor demand.
Maturity and Risk
Short-Term Maturity Risk
As of Q2 FY2025, about 32% of marketable public debt will mature within 12 months. This means the government must refinance a large portion of its debt soon—possibly at higher interest rates.
Average Maturity
March 2025: 71 months (just under 6 years)
March 2024: 70 months
March 2020: 69 months
A longer maturity helps reduce risk from rising interest rates.
Why Does National Debt Matter?
Too much debt can have serious long-term consequences:
1. Higher Interest Costs: More government revenue goes to paying interest.
2. Reduced Public Spending: Less money is available for health, education, and infrastructure.
3. Economic Pressure: Rising debt may lead to inflation and lower investor confidence.
4. Risk of Default: While unlikely for the U.S., growing debt raises global financial risk.
Conclusion
The U.S. national debt is growing rapidly, currently at $36.21 trillion, with projections suggesting it could reach $37 trillion by late 2025. While investors still show strong demand for U.S. debt, rising interest rates and short-term maturity risks make it a growing concern for policymakers and citizens alike.
Monitoring this trend is essential for understanding the future of the U.S. economy, the federal budget, and the financial stability of global markets.
Source: U.S. Treasury; JEC Republicans calculations
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