The U.S. Treasury is projected to borrow over $2 trillion by the end of the fiscal year, a figure that budget experts are calling “beyond scary.” This latest estimate, released by the Executive Office of the President, signals alarming increases in the nation’s fiscal deficit, raising concerns about long-term financial stability.
The Rising Deficit and Debt Levels
According to the latest Quarterly Refunding Documents from the Treasury Department, the Office of Management and Budget (OMB) has adjusted its projections for the fiscal year.
As of April 2026, the OMB now expects the federal government to run a deficit of $2.06 trillion for FY2026, which is higher than earlier estimates from the Congressional Budget Office (CBO). The OMB has also projected a deficit of $2.17 trillion for FY2027.
This indicates that the government is borrowing more than $166 billion per month throughout the current fiscal year, with that average expected to rise to $181 billion per month in the coming year. By comparison, the CBO had estimated deficits of $1.85 trillion for FY2026 and $1.89 trillion for FY2027. These growing deficits are adding to the U.S. national debt, which is nearing the $39 trillion mark, sitting at $38.91 trillion as of now.
Alarming Growth in Debt Servicing
The most concerning aspect of the rising national debt is the skyrocketing cost of servicing it. The U.S. Treasury paid nearly $530 billion in interest on the national debt between October 2025 and March 2026.
This equates to over $88 billion per month or more than $22 billion per week, which is comparable to the combined total of government spending on education and defense. The large interest payments are squeezing the federal budget and making it harder for the U.S. to invest in its future.
Calls for Fiscal Responsibility
Maya MacGuineas, president of the Committee for a Responsible Federal Budget, expressed deep concern over the growing deficit, saying, “$2 trillion deficits used to be unheard of, and then they only occurred during major recessions—it’s beyond scary that $2 trillion deficits are now the norm.” She warned that the continued increase in borrowing could lead to a fiscal crisis and urged urgent deficit reduction.
Frederick Kempe, president of the Atlantic Council, echoed these concerns, emphasizing the long-term risks of rising debt. He pointed out that higher debt could lead to higher interest rates on mortgages and business loans, potentially stifling economic growth.
Kempe also warned that increased debt could divert resources away from investing in the country’s future at a time when global competition, particularly with China, is intensifying.
3% Deficit Target
The push for a 3% deficit-to-GDP limit, which has gained bipartisan support in recent years, aims to curb the rising deficit. Proponents of this target argue that even a 3% limit would require substantial shifts in federal budgeting, with a goal of reducing the deficit by $10 trillion over the next decade to meet the target by 2036. Currently, the $2 trillion deficit represents more than 6% of GDP, double the 3% target.
MacGuineas emphasized the need to rein in deficits, stating, “Today’s news shows just how far we have to go. A $2 trillion deficit is more than 6% of GDP—about twice the 3% target—and things are getting worse, not better.” The growing deficit and rising national debt have sparked urgent calls from policymakers and experts for long-term solutions to ensure fiscal sustainability.
