President Donald Trump, as a Republican, should theoretically support fiscal conservatism. Yet according to a report by a financial journalist, under Trump America’s national debt and deficit are ballooning to dangerous levels.
“The price that the U.S. government has to pay to borrow money for 30 years has already punched through 5 percent a year, its highest level since the financial crisis of 2007,” reported The Washington Post's Matthew Lynn on Sunday. “For 10-year money, the annual price is 4.6 percent and climbing. Amid all the noise about the rise of artificial intelligence and the booming space economy, something far more significant is happening in the financial markets. The cost of borrowing is being reset.”
Lynn added that this raises the possibility that American voters will care enough about deficit reduction that it can become a politically viable issue again.
“The U.S. national debt has reached $39 trillion, with interest payments now exceeding $1 trillion annually, compared to the near-zero interest rate after the 2008 financial crisis,” Lynn wrote. “This could trigger a financial crisis and, even worse, modern political leaders are no longer even paying lip service to the need for deficit reduction.” As a result, “the big space in American politics will be waiting for a leader who can steadily balance the books while restoring competitiveness, keeping inflation under control and maintaining government services.”
Lynn concluded, “That won’t be easy. The U.S. deficit came in at 5.8 percent of gross domestic product in 2025, and it is not likely to be any lower this year. Bringing it down will require sustained hard work, lots of patience and the ability to tell hard truths. Those are not qualities that Washington has in abundance. Even so, it would be a big prize. The only real question is whether there is a leader out there who is willing to step up and take it.”
Lynn is not alone among finance experts who are concerned about America’s growing debt crisis, which has grown worse under Trump due to his tax cuts for the wealthy, war against Iran and spending cuts on programs that help low-income Americans.
“Unless we change course, the debt will only get worse—fast,” Brookings Institution senior fellow William Galston wrote for The Wall Street Journal earlier this month. “The Congressional Budget Office estimates that we are on track to accumulate more than $24 trillion in debt over the next decade, for a total of $56 trillion—120 percent of estimated GDP in 2036.”
He added, “These numbers are so large that it is hard to grasp what they mean. One key measure is the cost of financing this swelling debt burden. Twenty-five years ago, interest payments on the national debt were 2 percent of GDP. This year they will claim 3.3 percent; a decade from now, 4.6 percent.”
Trump’s outsized impact on the budget deficit began in 2017, when he passed another series of tax cuts for the wealthy called the Tax Cuts and Jobs Act (TCJA).
“The Joint Committee on Taxation and the Congressional Budget Office have published several estimates of TCJA’s expected budget impact,” the nonpartisan Tax Policy Center explains. “These estimates all show TCJA substantially reducing revenues and increasing deficits over its first decade. The specific amount varies—from about $1 trillion to $2 trillion—for three reasons.”
The Tax Policy Center continued, “First, the agencies estimated budget impacts using both conventional methods (which do not account for potential changes to the overall economy) and dynamic methods (which do). Second, the agencies originally estimated the budget impacts against a budget baseline established in 2017, when the act was debated and enacted. They later published updated figures using a 2018 baseline, which included new economic and budget information. Third, official scores typically do not include any new debt service costs resulting from tax cuts or spending increases. Projections for the entire budget, however, do include debt service.”
