In 2016, Trump pledged to erase the federal debt. It just hit $40tn

Billy Odell Tucker-Robinson Founder & Host — Banking With Billy Network • Financial Intelligence • Markets • World News • Independent Analysis
Published: 2026-09-03 • Permanent link

The federal debt has reached a staggering $40 trillion, a far cry from the $19 trillion it stood at in 2016. President Trump had vowed to erase the debt, but it seems that goal has been dashed. The increase is largely attributed to the trillions in tax cuts going to the rich and corporations, which could have instead been used to address the affordability crisis. Investors are taking notice, with market experts warning of potential economic instability.

The ballooning debt is a pressing concern for investors, as it raises the risk of a debt-driven recession. With interest rates on the rise, the burden of servicing the debt could become unsustainable, leading to a sharp decline in economic growth. Consumers are already feeling the pinch, with rising costs of living and stagnant wages making it difficult for them to make ends meet.

The current debt situation bears some resemblance to the debt bubble that preceded the 2008 financial crisis. In the early 2000s, the US government was running large budget deficits, which were largely financed by borrowing. However, this borrowing was not matched by corresponding economic growth, leading to a surge in debt levels. Experts warn that history may be repeating itself, with the current debt levels threatening to undermine economic stability.

As the debt continues to rise, investors will be watching closely for signs of economic stress. The upcoming 2024 presidential election could also play a role, as candidates may be forced to address the issue of debt. With interest rates on the rise and economic growth slowing, the next few years will be crucial in determining the trajectory of the US economy.