Washington — President Trump entered his second term pledging to shrink the federal government, end costly “forever wars” and spur growth to rein in the deficit. Less than two years later, the national debt has climbed past $40 trillion, and yields on Treasury bonds have risen to their highest levels in nearly two decades.
Debt growth outpaces spending cuts
According to the Committee for a Responsible Federal Budget, the debt increase reflects both the $8.4 trillion added by the first‑term tax cuts and another $4.7 trillion from the second‑term tax and immigration legislation, as reported by the Congressional Budget Office. While the administration touts the firing of thousands of federal workers and the elimination of “wasteful programs,” overall federal spending has continued to rise.
White House spokesman Kush Desai praised President Trump as “the first president to seriously take on pervasive waste, fraud, and abuse across the federal government,” but budget experts say the record shows a mixed picture. Maya MacGuineas, president of the Committee for a Responsible Federal Budget, stated, “There is no scenario in which one could look at the record of President Trump in both this term and the previous term, and declare it a fiscal success.” She added that while the administration set an agenda, lawmakers have failed to act decisively.
Implications for American families
The swelling debt threatens to raise borrowing costs for mortgages, auto loans and small businesses, directly affecting families across the country. As yields climb, mortgage rates follow, making home ownership more expensive for many households.
Experts warn that Congress may soon be forced to consider politically unpopular measures, such as raising taxes or trimming welfare programs, including Social Security, to keep the budget sustainable.
Historical context and partisan responsibility
Both parties share responsibility for the expanding deficit. Tax cuts under Republican presidents Ronald Reagan and George W. Bush, as well as wars launched during those administrations, widened the gap. Democratic presidents Barack Obama and Joe Biden added stimulus spending after the 2008 financial crisis and the COVID‑19 pandemic.
Demographic shifts also strain the budget. The retirement of the baby‑boom generation is draining Social Security and Medicare trust funds, while payroll tax revenue is falling short of future benefit obligations.
Policy direction under Trump
The Trump administration has shifted revenue collection by raising tariffs and cutting corporate tax rates, moving the tax burden toward workers and households rather than businesses and investors. Conservative commentator Romina Boccia of the Cato Institute noted that “Republicans are becoming very fond of alternative ways of raising more taxes to avoid politically difficult entitlement reforms,” a criticism the administration disputes.
President Trump remains confident that economic growth will offset the debt burden. Speaking at a rally on August 21, he claimed his policies could boost annual output by 20 percent, a level achieved only once since 1947. Federal Reserve Chair Kevin Warsh, however, warned that record investment in AI and big‑tech firms is tightening capital, driving up rates and worsening the government’s financing challenges.
Future outlook
While the administration points to recent economic gains and lower inflation as signs of fiscal improvement, former Federal Reserve Bank of St. Louis official William Emmons warned that President Trump’s policies have deepened an already challenging fiscal condition, stating, “He inherited bad momentum. It’s not a surprise to anyone that it was a challenging budget environment, both back in 2016 when he came to office and again today.”
As the November midterm elections approach, voters will likely weigh the impact of a $40 trillion debt load on their wallets, from mortgage payments to potential changes in welfare programs. The coming months will test whether Congress and the administration can find a bipartisan path to fiscal stability.
Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.
