Fact Brief · Summer 2026
Federal Budget & National Debt
Don't Be Played · A ClaimYourVoterPower.org Fact Brief
What is the issue?
The federal government has run a deficit — adding to the nation's debt — every year since 2001. Debt is not erased. It is repaid by future taxpayers — or refinanced, with interest due every year and no principal repaid.
Whose responsibility should national financial health be?
Know the terms
- Deficit —
- one year's gap: spending more than the government collects. The gap is borrowed.
- Debt —
- all past borrowing not yet repaid. The deficits add up.
- Gross national debt —
- everything the Treasury owes: debt held by the public plus debt owed to the government's own trust funds.
- Debt held by the public —
- money borrowed from outside lenders (people, funds, banks, other countries — including you, if you own U.S. bonds). It must be financed in markets, and it drives interest costs.
- Current law —
- the rules on the books today. Projections assume Congress changes nothing.
- Social Security —
- monthly benefits for retirees, survivors, and disabled workers. Today's payroll taxes pay today's retirees, topped off by the trust fund reserves.
The budget
Fiscal year 2025 — ended September 30, 2025
Spent vs. collected
The federal government spent about $7.0 trillion and collected about $5.2 trillion — roughly $1.34 spent for every $1.00 collected. The gap, $1.8 trillion, was borrowed and added to the debt. [1]
Where the money came from
Revenues rose 6% (up $317 billion), boosted by individual income taxes and customs duties (tariffs); corporate tax receipts declined. [1]
Where the money went
The largest categories (FY2025): Social Security benefits ~$1.57T; Medicare ~$0.99T (net of offsetting receipts) plus Medicaid ~$0.67T; net interest on the public debt ~$1.03T; and national defense ~$0.87T. [1]
The debt
Two measures — know which one a claim uses
The headline number
The gross national debt passed $39 trillion on April 1, 2026 — roughly $114,000 per person, or about $289,000 per household. [3]
What's inside it
Of that, ~$31.4 trillion is debt held by the public, and ~$7.6 trillion is owed to the government's own trust funds. [2] [3]
The biggest IOU
Within that $7.6 trillion, the Treasury owes the Social Security trust funds about $2.56 trillion (end of 2025) — decades of payroll-tax surpluses invested, by law, in Treasury securities. Reserves peaked at $2.91 trillion in 2021 and are now being drawn down, because Social Security's costs have exceeded its income since 2021. [7]
The record ahead — under current law
CBO projects debt held by the public will rise from 101% of GDP in 2026 to 120% by 2036 — the highest in U.S. history, passing the World War II record (106% in 1946) by 2030. [2]
The ten-year outlook
Deficits from 2026 to 2035 are projected to total $23.1 trillion. The 2025 tax-and-spending law added ~$4.7 trillion to that; higher tariff revenues (paid by U.S. companies and consumers) subtracted ~$3.0 trillion. A 2026 court ruling on tariffs may reduce that revenue, which would widen deficits. [2]
What drives the pressure
Three cost areas put the most pressure on the debt: Social Security, health programs, and interest. CBO projects Social Security will grow from 5.2% to 6.0% of GDP by 2035; the Social Security Trustees project that, unless Congress acts, the trust fund reserves run out in 2034 — and benefits would be reduced to what incoming taxes cover, about 83% of scheduled amounts. Mandatory programs and interest together grow from ~73% of all federal spending to ~78% by 2035 — leaving a shrinking share for everything Congress votes on each year. Defense's share shrinks even as its dollar amount grows. [2] [7]
When you hear a claim about the budget or debt, ask
- ?Which debt measure — gross debt (~$39T) or debt held by the public (~$31.4T)? Comparisons only work within one measure.
- ?A share of spending, or a dollar amount? A category's share can fall while its dollars grow.
- ?An actual result, or a projection? Projections change when laws change.
- ?One year, or ten? Ten-year totals sound ten times bigger.
Ways to handle the deficit and debt
- Reduce annual deficits by lowering spending, raising revenues, growing the economy faster — or a combination. CBO's "Options for Reducing the Deficit" catalogs 76 specific options, each with its estimated savings. [4]
- Reduce improper payments (overpayments, payments to ineligible recipients, documentation errors): about $186 billion reported in FY2025 — about 2.7% of federal spending; most were overpayments. [5]
- Reduce fraud: GAO estimates the government loses $233–$521 billion a year — roughly 3–7% of spending — based on 2018–2022 data that include pandemic-era programs. [6]
Note: these categories overlap. All fraud counts as improper payment, but most improper payments are errors, not fraud — and the recoverable savings are smaller than the headline totals.
What do the facts say?
- ✔Waste and fraud are real — and not nearly enough. Even eliminating every dollar at the top of GAO's fraud range (~$0.5 trillion) would close less than a third of the $1.8 trillion annual deficit. [1] [6]
- ✔Retirement programs, health care, and interest costs — not annual discretionary spending — are the main drivers of long-term budget pressure. [2]
- ✔The more that goes to interest on past borrowing, the less is available for current needs. Interest already exceeds the defense budget and is the fastest-growing major category. [1] [2]
- ✔Know your measures: the same day's debt can be described as $39 trillion or $31.4 trillion, and both are correct — they count different things. [3]
- ✔CBO's menu: 76 options for reducing the deficit — spending, revenue, or both. Each with estimated savings. [4]
Stay current
- Treasury Fiscal Data — the official daily numbers: "Debt to the Penny" and America's Finance Guide, in plain language. fiscaldata.treasury.gov
- Congressional Budget Office — nonpartisan budget projections, monthly budget reviews, and deficit-reduction options. cbo.gov
Sources & links
Verified July 16, 2026
Our research process
Every Fact Brief follows the same discipline — so you can trust what's on these pages, and check it yourself.
Prepared for educational purposes from publicly available sources believed reliable at the time of publication. Readers are encouraged to consult the original sources.
A www.ClaimYourVoterPower.org Fact Brief. Free to print, copy, host, and distribute unaltered, with attribution (CC BY-ND 4.0). Quotation with citation welcome. Published July 2026.