United States Must Pay Interest of Rp16.8 Trillion as Debt Addiction Worsens

The fiscal condition of the United States has again drawn attention due to the persistently high rate of debt accumulation amid continued government spending increases.

In the first five months of US fiscal year 2026, through February 2026, the US government is estimated to have recorded a deficit of approximately US$1 trillion, or equivalent to Rp16.865 trillion (based on an exchange rate of Rp16.865/US$1). It should be noted that the fiscal year in the United States does not follow the calendar year. The 2026 fiscal year in the US begins on 1 October 2025 and will end on 30 September 2026.

This situation is reported in the monthly report from the Congressional Budget Office (CBO) updated through February 2026. In addition, the US government is also estimated to have recorded additional borrowing of US$308 billion in just the past month.

Rising debt automatically pushes up the interest burden that the government must pay. From October 2025 to February 2026, the US Treasury Department spent an additional US$31 billion, or approximately Rp522.82 trillion, to pay net interest on public debt compared to the same period last year.

With this increase, total interest payments on US public debt in the first five months of fiscal year 2026 have already reached US$433 billion, or approximately Rp7.3 trillion, to cover interest obligations on the debt.

The CBO explains that this increase in the interest burden occurs because total government debt is now larger than last year, whilst long-term interest rates remain at elevated levels. However, the decline in short-term interest rates has somewhat constrained the overall pace of interest payment increases.

Although the figures remain extremely large, the US fiscal deficit is actually slightly improved compared to the same period last year. In the first five months of fiscal year 2025, the US government had to increase borrowing by US$142 billion more than this year.

However, this improvement is considered insufficient to allay concerns about US fiscal health. Maya MacGuineas, President of the Committee for a Responsible Federal Budget, believes this situation cannot be allowed to continue. She warned that US government debt interest payments are estimated to hit US$1 trillion this year, or Rp16.865 trillion, and could even exceed US$2 trillion by 2036.

According to her, the US government needs to promptly restructure its fiscal conditions. One important initial step is considered to be reducing the deficit to the equivalent of 3% of gross domestic product (GDP).

In the view of many economists, the main issue is not simply the size of total government debt. National debt is actually one of the important foundations of the global financial system.

However, the concern is the debt-to-GDP ratio, which is a measure that compares the size of debt with the economic capacity of a country. If debt grows too large compared to economic capacity, the government will be increasingly burdened by interest payments. This condition could ultimately compress productive spending space and hamper growth.

In addition, the deficit-to-GDP target is also an important measure for assessing fiscal health. In recent years, the US deficit-to-GDP ratio has been in the range of 5% to 6%, well above the 3% target considered healthier.

If examined more deeply, the slightly improved US deficit in the first five months of fiscal year 2026 is not because the government has reduced spending. Quite the opposite—expenditure continues to rise. The improvement occurred because government revenue also increased, allowing spending increases to be somewhat constrained.

Receipts from tariffs, including duties, surged more than fourfold compared to the same period last year, rising by US$109 billion. Although some levies in 2025 had to be returned to US importers following a US Supreme Court ruling in February, additional tariffs announced by the government kept the impact of reduced revenue relatively limited.

In addition, receipts from individual income tax and wage tax or social security contributions also increased significantly. Combined, these two items increased by approximately US$132 billion.

However, on the other hand, US government spending also continues to increase. In the first five months of fiscal year 2026, total expenditure reached US$3.1 trillion, or up US$64 billion compared to the same period last year.

The three largest spending programmes of the US government—social security, Medicare, and Medicaid—are the main contributors to this increase. Spending on these three programmes increased by US$104 billion.

Given these conditions, pressure on US fiscal health appears unlikely to ease quickly. So long as spending remains high and debt interest continues to grow, the US government will still face major challenges in maintaining fiscal balance amidst a tightening fiscal space.