The United States is seeing its fastest-ever rise in national debt, according to a new report from the International Monetary Fund (IMF). The forecast warns that under the policies set in motion by the “One Big Beautiful Bill,” passed earlier this year, U.S. debt could soon surpass that of Greece and Italy — countries once hit by severe financial crises.
The IMF projects that by 2030, the U.S. will have the world’s highest debt-to-GDP ratio. This means the country’s total debt will be larger than the size of its economy, a level that no other nation is expected to reach. The report notes that while Greece and Italy have made progress in stabilising their finances, the U.S. continues to expand its debt burden.
Data from the Treasury Department shows the U.S. national debt has reached $38 trillion, a record high. The pace of borrowing is the fastest since the COVID-19 pandemic, when emergency spending was used to stabilise the economy.
The U.S. federal deficit has stayed above $1 trillion for six consecutive years. In the last fiscal year, it was $1.8 trillion, and current estimates suggest it could reach between $1.7 trillion and $2.2 trillion this year.
What’s inside the ‘One Big Beautiful Bill’
The “One Big Beautiful Bill” has been a major driver of new federal spending. The law extended the 2017 tax cuts and increased funding for U.S. Immigration and Customs Enforcement (ICE).
Extending the tax cuts reduced government revenue, continuing benefits that mainly affected corporations and higher-income groups. At the same time, expanding ICE operations added large costs to federal budgets, as new resources were allocated for deportation and border enforcement programs.
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The bill’s total spending far outweighed any savings from other government programs. A separate initiative called DOGE, launched to reduce wasteful spending, has shown minimal results. Investigations found that most of the funds labeled as “cut” under DOGE remained within agencies rather than being returned to the Treasury.
No clear record exists of the actual savings achieved, as reports from departments, budget officials, and independent analysts all differ. This lack of verified data has led to uncertainty over the effectiveness of the government’s cost-cutting efforts.
IMF warning: debt risks and economic strain
The IMF report highlights that high debt levels can push up interest rates and inflation, raising costs for consumers and businesses. It also limits how much the government can invest in essential programs such as healthcare, education, and infrastructure.
According to the Government Accountability Office, by 2044, interest payments alone could exceed federal spending on Social Security — currently the nation’s largest program. The U.S. has already paid $4 trillion in interest over the past decade and is expected to spend $14 trillion more in the next ten years.
Such costs do not reduce the debt itself but represent the price of borrowing money. This means that as interest expenses grow, less funding remains for public investment or debt reduction.
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Credit downgrades and global confidence concerns
The United States has faced three credit rating downgrades in recent years, reflecting growing concern among investors over its rising debt and lack of fiscal control. These downgrades make it more expensive for the government to borrow, increasing long-term financial pressure.
Experts warn that persistent high debt could also affect the U.S. dollar’s position as the world’s main reserve currency. The IMF cautions that continuing fiscal imbalance may weaken global confidence in the dollar, which has long supported America’s economic stability and trade power.
Officials maintain that tariff revenues and reduced spending could help narrow the budget deficit, but independent economists note that these measures have yet to show measurable impact.
The IMF’s assessment concludes that the United States is now on track to exceed the debt levels once associated with Europe’s financial crises — a trend that could reshape the country’s economic standing in the years ahead.