A bunch of papers: how much more can the US borrow without a debt crisis

The United States will continue to increase its debt as long as the market is ready to buy American bonds on acceptable terms, experts interviewed by Izvestia believe. The main risk is not the obligations themselves, but the rising cost of servicing them. The national debt of the United States this week exceeded $40 trillion for the first time — since the beginning of the conflict in the Middle East alone, the figure has jumped by $1.31 trillion. In June, investments in American securities were reduced by Japan, Great Britain, China and Russia, although it had few of them. Against the background of weakening foreign demand, Washington has to attract new money more and more expensive. The yield on 30-year Treasuries rose to 5.33%— the highest since 2007.

The US national debt in 2026

On August 19, the US national debt exceeded $40 trillion for the first time, according to data from the US Treasury Department. More than $32 trillion are liabilities to the population and organizations, and more than $7 trillion are government borrowings. Each American accounts for about $120,000 of the country's debt.

Borrowing growth has accelerated in recent months. The main reason is the chronic gap between budget expenditures and revenues, said Anton Nikitin, CEO of Fingold. He explained that the higher the national debt becomes, the more funds have to be allocated to pay interest on it. As a result, the deficit of the American treasury increases, resulting in a vicious circle. After 2020, it amounted to more than 5% of GDP, recalled Freedom Global macroeconomist Yuri Ichkitidze. In July 2026, the deficit reached 6%.

Spending on healthcare, social security and pensions also creates an additional burden, the expert continued. Another factor is the cancellation of some tariffs: court decisions deprived the budget of about $100 billion in revenue from import duties, explained economist Olga Gogaladze.

The fighting between Iran and the United States has also added to the burden on the national debt. In almost six months of conflict in the Middle East, it has grown by $1.31 trillion (107 trillion rubles), Izvestia estimates. U.S. defense spending in March —July 2026 amounted to $392 billion, an increase of 9% compared to last year, said Yuri Ichkitidze.

— The situation in the Strait of Hormuz has increased the problem, but it has not become its cause. Its overlap fueled inflation expectations and forced investors to demand higher yields on Treasuries, which increased the cost of borrowing for the United States, Olga Gogaladze said.

Are there any risks from the growth of the US government debt

Currently, the ceiling of the US national debt (the limit of the amount that the government can borrow to fulfill its obligations) is set at $41.1 trillion. According to experts interviewed by Izvestia, the US government may raise the level of borrowing for a long time.

This is especially true of the US economy, which relies heavily on intangible production and the financial sector, says Mikhail Khachaturian, associate professor at the Department of Strategic and Innovative Development at the Financial University. The shortage of large-scale industries that create tangible products and generate tax revenues remains one of the reasons why, even with the growth of the economy, it is difficult to reduce the budget deficit.

According to Olga Gogaladze, the debt of the United States to its GDP now stands at about 122-124%, the highest level since World War II. At the same time, the cost of its maintenance reached a historic high of $1.2 trillion per year, Oleg Abelev, head of the analytical department at the Rikom-Trust investment company, continued. At the same time, the American economy continues to grow — it added 1.5% in the second quarter of 2026.

— Now the country is not on the verge of an immediate default, but in a situation of accumulation of structural risks. One of the main alarming signals is the growth of long—term bond yields. The higher the premium investors demand for 10-30-year Treasuries, the more expensive it becomes for the government to refinance existing obligations," explained Anton Nikitin from Fingold.

By 17:00 Moscow time on August 20, the yield on 10-year US bonds was 4.69%, having increased by 2.04 percentage points over the month, while the yield on 30-year bonds reached 5.23%, adding 2.39 percentage points over the same period. Recently, it even rose to 5.33%, which is the highest since 2007.

Against the background of rising yields, the US Treasury announced an increase in the volume of repurchases of long-term securities with a maturity of 10 to 30 years at least twice. This means that the authorities will buy back their own loans. However, such a move has already had a positive effect on the market: interest rates on Treasuries have decreased slightly. This increases the demand for bonds and supports their prices. As a result, the yield of securities may decrease further.

According to Oleg Abelev, so far the United States has two key advantages: the US government debt market is the most liquid in the world, and the dollar remains the key global reserve currency, which allows Washington to attract financing on acceptable terms.

Who will finance US government loans

In recent months, large holders have begun to strategically review the structure of their investments. Japan, the UK and China reduced the share of reserves in US bonds in June. However, they still hold huge amounts in them: Japan accounts for $1.16 trillion, the UK for $940 billion, and China for $633.4 billion.

There is no full-fledged alternative to US Treasury bonds yet: the Treasuries market remains the largest and most liquid, noted economist Olga Gogaladze. However, other options have already begun to appear in the world — Europe is actively promoting its bonds, and some countries are switching to gold.

The volume of Russian investments in U.S. government securities also decreased to $27 million (about 2.2 billion rubles) in June. A month earlier, it was $29 million. Against the background of the total US debt of $40 trillion, this is a very modest amount. Therefore, the situation with American bonds does not affect the stability of the Russian market, Olga Gogaladze is sure.

— The actions of the largest holders of Treasuries — China, Japan and other international investors - are much more important. However, the fact that more and more countries are looking for alternatives to dollar assets creates psychological pressure on the US currency and can accelerate the process of de—dollarization," she explained.

It is likely that states will gradually reduce their dependence on US government debt and choose other assets, experts believe. In such circumstances, it will be more difficult for the United States to count on unconditional demand for new loans, added Anton Nikitin from Fingold.

How does the growth of the US national debt affect other countries

The growth of US government borrowing is not only a problem for the US budget, but also a question of the stability of the entire financial system, Anton Nikitin said. The more Americans borrow, the higher the returns they must offer to keep investors interested. This puts pressure on rates and makes capital more expensive for businesses and investors around the world.

Russia's public debt is significantly lower — about 16% of GDP, but its maintenance is more expensive due to high inflation and interest rates, Oleg Abelev noted.

With such a high U.S. debt, rising interest payments could deprive America of such an advantage and turn the problem into a factor of global instability, the expert explained.

Since 2018, the Russian Federation has been reducing investments in US government debt due to sanctions risks. In April of that year, the figure fell from $96 billion to $48.7 billion, and in May it dropped to $14.9 billion. Therefore, the issue is not the loss of these assets, but the continued role of the dollar in international settlements.

In addition, the main risk for our country is a possible global financial crisis, which can hit through lower energy prices and an increase in the cost of imports, Oleg Abelev believes. This is especially important for the Russian economy, as oil and gas revenues remain one of the key sources of budget replenishment: they account for about 20% of all treasury revenues. Lower oil prices directly reduce revenue from export duties and mining taxes, which may increase pressure on the treasury.

However, such a crisis is possible only if an increase in the US debt burden leads to a sharp increase in yields on US bonds, a decrease in investor confidence and a large-scale sale of assets on world markets.