The federal government closed its 2026 fiscal year on September 30 owing $40.17 trillion, according to the Treasury Department. That is $2.53 trillion more than it owed when the year opened, an increase of 6.7 percent in 12 months.
Treasury’s daily Debt to the Penny report put total public debt outstanding at $40,171,825,101,340.31 that day. A year earlier, on the last day of fiscal 2025, the figure was $37,637,553,494,935.61. Averaged over the 365 days between those two dates, Washington added about $6.9 billion in debt per day.
Most of the new debt is owed to lenders outside the government. Debt held by the public, which Treasury defines as federal debt held by entities outside the U.S. government, rose $2.15 trillion in the year, or 7.1 percent, to $32.43 trillion. It made up about 85 percent of the increase. Intragovernmental holdings, the federal debt held by the government’s own accounts, grew $387 billion to $7.75 trillion.
The pace picked up. In fiscal 2025 the debt grew $2.17 trillion, starting from $35.46 trillion on September 30, 2024. Fiscal 2026 added about $361 billion more than that. Over the two years combined, the total rose $4.71 trillion.
The debt first closed above $40 trillion on August 18, at $40.05 trillion. It added another $124 billion in the six weeks that remained in the fiscal year.
Every dollar of the new public debt carries interest. Carrying it got more expensive on September 16, when the Federal Reserve raised its benchmark rate by a quarter point.
Texas keeps its own books under rules the federal government does not have. Article III, Section 49 of the Texas Constitution bars the state from creating debt except in narrow cases. New general state debt beyond those cases needs a joint resolution passed by two-thirds of each house of the Legislature and then the approval of Texas voters at an election.
Section 49a, added in 1942, goes further. An appropriation that exceeds the cash and anticipated revenue of the funds it draws on is not valid unless four-fifths of each house declares an emergency. No bill containing an appropriation can be sent to the governor until the comptroller certifies that the money is there, and when a bill comes in over the estimate, the comptroller sends it back to the chamber where it started so the Legislature can either raise the revenue or cut the appropriation.
The U.S. Constitution has no provision like Section 49a. No Texas voter was asked to approve the $2.53 trillion Washington added to its debt this year.
Texans already decide their state’s fiscal course in Austin, under limits they wrote into their own constitution. Whether Texas stays bound to Washington’s books is a decision Texans can make the same way.
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