American Household Debt at Record Levels, However Americans Continue to Spend

Household debt continues to rise as Americans keep spending. Increases in the cost of living have outpaced salary growth, while elevated interest rates have added to the strain.

The elimination of Biden-era benefits and loan forgiveness programs has also weighed heavily on many households that had grown accustomed to government relief and easy credit.

Total U.S. household debt reached a record $18.59 trillion in Q3 2025, an increase of $197 billion from the previous quarter. Household debt is distributed across several categories, with mortgages making up the largest share.

Mortgage balances rose by $137 billion to $13.07 trillion, while credit card balances climbed by $24 billion to $1.23 trillion, an all-time high, nearly 6% higher than a year earlier.

Student loan debt also reached a record $1.65 trillion, while auto loan balances remained steady at $1.66 trillion.

By category, total household debt includes $13.07 trillion in mortgages, $1.66 trillion in auto loans, $1.65 trillion in student loans, $1.23 trillion in credit card debt, $0.55 trillion in other debt, and $0.42 trillion in home equity lines of credit (HELOCs).

While the debt itself is problematic, a more worrying economic indicator is the rise in delinquencies.

About 4.3% of total debt is now more than 30 days past due, the highest level since early 2020 but still well below the 11% recorded during the 2009 financial crisis.

Nearly 10% of all student debt has been reported as 90 days or more delinquent, marking a record high for student loan delinquencies.

Liberal Democrat policies are partially to blame, as the spike stems in part from missed federal student loan payments that were not reported to credit bureaus between Q2 2020 and Q4 2024, which are now appearing in credit reports following the end of the pandemic payment pause.

Currently, 7.7% of aggregate student debt was reported as 90 or more days delinquent, compared to less than 1% in Q4 2024.

Keep reading

America’s $30 Trillion Publicly Held Debt Is 42 Times Larger Than It Was in 1980

In 1980, America’s publicly held debt reached more than $712 billion (about $2.8 trillion in 2025 dollars), or roughly 25 percent of annual U.S. gross domestic product (GDP). Today, that figure is a little over $30 trillion, or around 100 percent of GDP. And as the federal debt grew 42 times larger over that span, the economy grew only tenfold. You can’t expand the numerator four times faster than the denominator for 45 years without courting economic danger.

That’s where we find ourselves. The U.S. is at peace, and despite President Donald Trump’s claims, there’s no national emergency. And yet we’ve only seen debt as a higher share of GDP during the years of 1945, 1946, 2020, and 2021. Then, Republicans and Democrats knew to scale back. Now, debt explodes during emergencies and continues to grow in peacetime.

In 1946, after World War II, debt-to-GDP was 106 percent. It declined to just 25 percent by 1980, not only because of inflation and economic growth but because of real fiscal discipline. With budgets nearly balanced, the fruits of a booming private sector could actually reduce the burden. Beginning in the Reagan era, discipline gave way to a new normal of chronic budget deficits.

Three forces made the shift possible.

First, and the main cause of the mess we are in, is that the entitlement state became enormous yet untouchable. The Social Security reforms of 1983 are a rare example of bipartisan structural reform of a major entitlement program in U.S. history. Since then, despite economic and societal changes, the program has never been reformed. Never mind that it faces insolvency and the potential for automatic benefit cuts of more than 20 percent in 2033. The same is true of our other major debt driver: Medicare. And Medicaid is growing far beyond its original intent.

Democrats, occasionally helped by Republicans, have worked to expand welfare programs meant for lower-income people to those in higher and higher income brackets. The most recent and extreme example is the COVID-19–era expansion of the Obamacare tax credit to wealthier taxpayers, a significant share of whom enjoy early retirement. The fight over its continuation is what the government shutdown is about.

Second, Republicans discovered that promising tax cuts without offsetting spending cuts was politically painless so long as one claims that they “pay for themselves.” There is one rare and recent exception: this year’s “One Big Beautiful Bill,” which included $1.5 trillion in spending reductions over 10 years to offset some of the tax cuts. It’s not enough, but it’s something. Meanwhile, the Democrats love to claim that debt wouldn’t be a problem if the rich paid their “fair share.” They already do pay an enormous amount in taxes. But the numbers still don’t add up.

Finally, the Federal Reserve, starting under then-Chairman Alan Greenspan in 1987, learned how to anesthetize the political pain of budget deficits by keeping interest rates artificially low and monetizing debt. Politicians concluded that they could borrow endlessly without suffering political consequences. The problem is that this only works insofar as investors don’t worry that they will be paid back with inflated dollars.

That illusion has vanished. Interest costs have surged from $372 billion annually just a few years ago to nearly $1 trillion today, surpassing what we spend on defense or Medicaid. Within a decade, yearly interest payments are projected to nearly double, reaching $1.8 trillion. Even without new programs, the built-in deficit would keep rising and outpace economic growth. And Washington keeps adding more deficit spending.

Keep reading

The Hidden Architecture Of Debt: How Private Banks Captured The Global Economy

Introduction: Why Money Power Matters

Most people graduate school knowing trigonometry but not how money is created. We learn to vote for parties but rarely examine who shapes the economic terrain those parties must walk on. Yet for more than a century, the power to create money as interest-bearing debt has quietly concentrated economic and political control in private hands. The result is a world where nations strain under compounding obligations, public debate revolves around the margins of policy, and whole societies become dependent on a credit system they neither designed nor fully understand.

This essay distills key arguments and quotations (historical and contemporary) about how modern banking actually works, why debt has become the engine of governance, and what that means for sovereignty, prosperity, and even our moral compass. The aim is not to recycle slogans but to clarify mechanisms: how money enters circulation, who benefits first, who bears the risks, and why the system almost always demands more growth, more extraction, and more debt.

1) The Core Mechanism: Money as Debt, Not as Value

A century of central banking and commercial credit has normalized a simple but profound fact: most new money is created when banks make loans. As former U.S. Treasury Secretary Robert B. Anderson put it in 1959, when a bank issues a loan, it credits a deposit that did not exist the moment before; the new deposit is “new money.” In practice, this means the money supply expands primarily through private lending, not public issuance.

That mechanism is turbocharged by fractional-reserve banking and today by capital-based banking rules: banks do not lend out pre-existing savings one-for-one; they expand deposits by creating credit. Interest is attached to that credit, meaning the system requires continual new borrowing to service past borrowing. If credit creation slows materially, defaults rise, asset prices wobble, and political pressure mounts to “stimulate” again. In short, we live inside a treadmill that is far more credit-driven than most civics textbooks admit.

Critics from Henry Ford to John Scales Avery have argued that this arrangement is structurally unjust because it privatizes the seigniorage (the profit of creating money) and socializes the fallout (inflation, asset bubbles, austerity). Whether or not one accepts every claim these critics make, the underlying math is hard to ignore: when money arrives as interest-bearing debt, the system has a built-in bias toward ever-expanding leverage.

2) From Private Credit to Public Power: How We Got Here

Modern banking’s political leverage grew alongside institutions like the Bank of England and, later, the U.S. Federal Reserve (established in 1913). Whatever the intention of their founders, central banks now sit at the junction of state and finance: they are publicly mandated yet operationally insulated (and privately owned), coordinating liquidity to stabilize the system while commercial banks originate most money-like claims.

This hybrid design has real consequences. It allows a small circle of decision-makers to set the price of money (interest rates), backstop private balance sheets in crises, and influence fiscal choices by making some policies financially easy and others expensive. Former Fed Chair Alan Greenspan once emphasized the institution’s independence; the flip side of that independence is low democratic visibility over choices that shape every mortgage, job market, and public budget.

Beyond national central banks lies the Bank for International Settlements (BIS) in Basel — often called the “central bank of central banks.” Through standards (Basel accords) and coordination, it helps align global banking rules. Critics argue this produces a technocratic layer of control over national economies with little public oversight. Whether one views that as prudent stewardship or as democratic deficit, it underscores a theme: the architecture of money governance is largely opaque to the public it governs.

3) Debt as an Organizing Principle: Nations on the Hook

If money is introduced mainly through borrowing, then borrowers become the gearwheels of the system. This is true of households, firms, and crucially governments. National debts have exploded over decades. Interest on those debts is neither a schoolbook abstraction nor a harmless line item: it diverts tax revenue from public goods to creditor claims year after year.

Concrete examples illustrate the point. Countries such as Ireland have paid billions annually in debt interest, amounts that can reach a significant share of national profits in strong years. Canada has spent tens of billions per year on interest at various points. The United States services hundreds of billions annually. The deeper the debt stock and the higher the rates, the more fiscal space narrows — and the easier it is for outside creditors and institutions to demand policy concessions as the price of liquidity.

International lending reinforces the pattern. When a country is pulled into a crisis, the usual medicine involves austerity and privatization in exchange for financing — effectively transferring public assets and future cash flows into private hands. Even when such programs stabilize a currency, they often leave a legacy of reduced sovereignty and social strain. Either way, the organizing principle remains: service the debt first.

4) Why Perpetual Growth Feels Non-Negotiable

Once you grasp that interest-bearing credit is the dominant source of new money, the politics of “growth at any cost” make more sense. If economies must expand to service past obligations, then policymakers are incentivized to chase GDP even when the ecological or social returns are negative. This is why governments of every stripe tend to converge on similar policies when growth stalls: tax incentives to borrow and invest, financial repression to keep rates low, deficit spending to plug holes, and pressure on central banks to ease again.

Critics like Roy Madron, John Jopling, and John Scales Avery have argued that this growth-dependency crowds out other goals: equitable distribution, environmental stewardship, and cultural stability. It also explains why mainstream debates often avoid the root structure and instead focus on the speed of the treadmill. We argue about 2% vs. 3% inflation rather than who issues money, who captures seigniorage, and who eats the losses when cycles turn.

Keep reading

Europe’s Suicide Pact: Debt, War Economy, And The Climate Cult

The EU summit on Thursday in Brussels focused primarily on security issues. To put it bluntly: Ukraine must somehow turn its lost war against Russia into a victory, and the EU must be militarily ready for action by 2030. The fact that this would only be feasible with a functioning economy has apparently not yet dawned on the power center in Brussels. Instead, they are preparing for a major fiscal “liberation strike,” giving bureaucracy a lush boom of its own.

When German Chancellor Friedrich Merz traveled to Brussels for the EU summit, his fiery rhetoric about EU bureaucratization followed him closely. “Let me put it in very vivid terms: We need to stick a branch into the wheels of this Brussels machine so that this stops,” Merz declared in September at a conference of the SME and Economic Union — playing, for a brief moment, the role of someone who understands the concerns of the small-business community.

Empty Media Theater

Given today’s Kafkaesque bureaucratic pressures, Merz will likely resort more frequently to this kind of small-business slang in the coming months — whenever the complaints from industry grow louder and demands to end pointless regulatory harassment reach public consciousness.

But no one should expect serious reforms. The example of relabeling “citizen’s income” to “basic security” without any structural change shows that the German government’s policy amounts to a media performance, buying time to defend Brussels’ eco-socialist course at any cost.

The summit confirmed this: Some “mini-reforms” are allowed to release a bit of pressure — but the fundamental line is untouchable. By 2040, the EU must produce climate-neutral output, no matter the cost — either through radical de-growth like in Germany or via buying CO₂ indulgences from elsewhere. As long as the climate books balance, nothing else matters.

Loyal Climate Disciple

Despite the sharp rhetoric, Merz remains a loyal disciple of Brussels’ regulatory-and-climate policy. Along with 19 other European leaders, he presented a sweeping reform proposal to strengthen EU competitiveness. In a letter to EU Council President António Costa, they demanded the Commission review all rules by year-end, scrap outdated and excessive regulations, and reduce new legislation to an “absolute minimum.”

This is rhetorical shadowboxing. Tough talk about regulatory madness — followed by nothing. At best, critics are pacified with subsidies. It’s the oldest EU trick: today’s credit-financed subsidy silences dissent and shifts the price — inflation and higher taxes — into the future.

Masters of Concealing Causality

Brussels is world champion in disguising cause and effect.

In fact, the EU is already preparing a €2 trillion heavyweight budget to be launched in 2028 — with green subsidies and new war machinery, all centrally orchestrated and embedded into national bureaucracies. In Germany’s case, Brussels’ debt wave is complemented by another €50 billion per year from “special funds.” Thousands of new government jobs will be needed to distribute this credit shock.

That this will inevitably trigger major inflation and further tax hikes is something the Chancellor prefers not to mention. The public mood is already… let’s say: tense. No need to pour fuel on that fire.

War Economy = More Bureaucracy

The build-out of a European war economy — with Germany as the main engine — will further swell the state apparatus. Defense and green sectors together form a massive impoverishment program targeting the European middle class, which is being milked more bluntly than ever.

Rising carbon taxes, an EU-wide plastic levy, higher business-tax multipliers, exploding labor costs — the construction of a EU super-state and the financing of its climate ambitions is a costly pleasure.

Germany’s companies are suffocating under mountains of freshly minted EU regulation. Direct bureaucracy costs alone amount to about €70 billion annually, according to a study by the Bundesbank.

Keep reading

‘Something has to give’ watchdog warns as national debt climbs rapidly toward $39 trillion

Awatchdog group is warning that “something has to give” as the U.S. national debt climbs rapidly toward $39 trillion.

The national debt grew faster than at any time other than the COVID-19 pandemic to $38 trillion this week, in part, due to the lifting of the debt ceiling under the GOP’s “One Big Beautiful Bill.” Before the bill was signed in July 2025, the debt ceiling was $36.2 trillion.

In a detailed press release, The Committee for a Responsible Federal Budget (CRFP) predicted that the U.S. would “likely hit the next milestone in just a matter of months.” The CRFB estimated that the deficit would likely reach $2 trillion for fiscal year 2026. 

The deficit was $1.8 trillion in fiscal year 2025, which just concluded on September 30.

Prior to the COVID-19 pandemic, the deficit was under $1 trillion.

In fiscal year 2019, the deficit was $984 billion and the national debt was $22.7 trillion, according to Treasury Department data. 

The road ahead: $1 trillion for interest payments will be needed

“We’re on course to spend $1 trillion just on interest payments on the national debt this year, exceeding our spending on our national defense,” Maya MacGuineas, president of the CRFB said in the statement. 

“Something has to give – and eventually it will, whether we are prepared for it or not,” she added.

According to the Joint Economic Committee, the total U.S. national debt has increased by $69,713.82 per second over the past year.

“The reality is that we’re becoming distressingly numb to our own dysfunction. We fail to pass budgets, we blow past deadlines, we ignore fiscal safeguards, and we haggle over fractions of a budget while leaving the largest drivers untouched,” MacGuiness said.

“Social Security and Medicare, for example, are just seven years from having their trust funds depleted – and you don’t hear anything from our political leaders on how to avoid such a disaster,” she added.

The CRFB said current law “calls for deep across-the-board cuts in benefits” when the trust funds are depleted. 

Keep reading

One Third Of Americans Have More Credit Card Debt Than Savings

One in three Americans now have more credit card debt than emergency savings, according to the latest survey by financial services company Bankrate.

As Statista’s Anna Flecks shows in the chart below, this is up ten percentage points from 2011, when the company first started polling the question.

Meanwhile, around 53 percent of respondents said that their savings were currently exceeding their credit card debt.

This is down two percentage points from the same time last year, but slightly up from 2011.

Around one in ten Americans are living paycheck-to-paycheck in 2025, not making any debt or saving up money.

You will find more infographics at Statista

Millennials were the most likely to say that they had tapped into their emergency savings over the past 12 months.

Keep reading

2 In 5 Young Adults Are Taking On Debt For Social Image, To Impress Peers, Study Finds

You can thank the Tik Tok, Instagram world we live in…

Money may not buy love, but for many young adults, it’s still the ticket to attention. A new study shows that two in five Gen Zers admit going into debt just to impress others — often in dating and social situations, according to Credit One Bank.

The pressure to perform financially is high among younger generations. Half of Gen Z and millennials (51%) say they’ve faked wealth or success, with Gen Z leading at 54%. Nearly 38% admit they’ve damaged their credit score or gone into debt to impress someone, and 37% say they’d even overdraft their accounts for a date. Men feel that pressure most: 46% would go into debt for a single date, compared to just 28% of women.

Credit One Bank writes that more than half of consumers say a high credit score makes someone more attractive, while nearly 70% would lose confidence in a boss with bad credit. Still, disclosure is rare: 54% of Gen Z and millennials prefer not to share their financial details with a partner until things get serious. Only 8% call poor financial history a marriage dealbreaker. Nearly half (48%) say they’d marry someone with a shaky financial past, especially if that person was improving. Gender gaps persist: men (47%) are more forgiving, while women are twice as likely to reject a partner over money issues (10% versus 5%).

Keep reading

Congress close to missing ‘basic’ budget deadline for 29th year, watchdog group says

Congress is on its way to missing a “basic” budget deadline for the 29th year in a row, according to the Committee for a Responsible Federal Budget.

Meanwhile, the deficit so far into the current fiscal year is larger than the same period last year. 

“We’re less than a month away from a possible government shutdown, and lawmakers are once again finding themselves without a plan to keep the government funded,” said Maya MacGuineas, CRFB’s president. “If all 12 appropriations aren’t signed into law by September 30, it will be the 29th year in a row that they failed to meet the most basic deadline in budgeting. That’s not a streak to be proud of.”

MacGuineas said that the current spending showdown is the latest example of how broken the budgeting process is in Washington.

“This is just another sign that the budget process is completely broken. Congress hasn’t passed a real budget resolution in 10 years. Often, they pass no budget at all. And when they do pass one, it’s either full of fantasy math, simply an excuse to facilitate the passage of partisan reconciliation bills, or both,” she said. “Going through the process of crafting a budget around the nation’s priorities now sounds like a fairytale – in fact, the President hasn’t even bothered to submit a full budget for Fiscal Year 2026.”

The federal government has borrowed $1.9 trillion so far into FY2025 from September 2024 through August 2025, according to the latest Congressional Budget Office (CBO) data. The borrowing is slightly higher than the same time period of fiscal year 2024.

However, the monthly deficit for August is lower than last year. 

The deficit was $360 billion in August 2025, which is down from $380 billion in August 2024. 

According to CBO data, federal tax revenue for August 2025 was $344 billion, which is a $37 billion increase compared to August 2024. 

Spending in August 2025 was $17 billion higher than August 2024.

In total, the deficit so far into FY2025 is $1.9 trillion compared to $1.8 trillion during the same time period of FY2024.

The CRFB estimated that the FY2025 rolling deficit is about 6.4% of GDP, which is close to FY2024.

“Over the past 12 months, total nominal revenue was $5.2 trillion compared to $4.9 trillion over the same period prior. Nominal spending was $7.1 trillion over the past 12 months compared to $6.9 trillion the same period prior,” read a CRFB analysis.

MacGuineas suggested that lawmakers should work to avoid a shutdown and improve the fiscal situation of the country at the same time. 

“In light of our massive debt, they should reduce both defense and non-defense spending levels below their current levels and extend the expiring discretionary spending caps to enforce additional deficit reduction,” she said. 

Keep reading

Wealthy Liberal Enclave of Santa Monica to Declare ‘Fiscal Emergency’ over Sexual Abuse Payouts

The city council of Santa Monica, California, will be asked to declare a “fiscal emergency” this week over hundreds of millions of dollars that it has paid in ongoing sexual abuse litigation.

The city by the beach, which has been hit by homelessness, crime, and an ongoing retail collapse, now faces fiscal catastrophe.

The Santa Monica Daily Press reported: “The dire financial situation is a result of a shortfall in revenue relative to forecasts combined with ongoing litigation, most notably the Uller sexual abuse case.”

The publication reported in 2023 that the city had reached a $229.8 million settlement over the claims: “Eric Uller was accused of abusing young boys between the late 1980s and early 2000s while he was employed by the City and volunteered in the Police Activities League (PALs), a city owned nonprofit. He committed suicide before his criminal trial in 2018.”

The Los Angeles Times reports that the case has crashed the city:

Services in Santa Monica are also suffering, according to the [city’s] report. During the COVID-19 pandemic, city leaders slashed the city’s budget and eliminated hundreds of positions. City services haven’t been restored to pre-pandemic levels, and several capital projects remain unfunded.

…

The report also cites recent and proposed changes by the federal government, including tariffs and mass deportations, that could affect the local and national economies.

…

In April, Santa Monica ended negotiations with Olympics organizers to host beach volleyball during the 2028 Games.

Santa Monica is often referred to as the “People’s Republic of Santa Monica,” due to its left-wing policies. It is one of the wealthiest towns in America, and diverts public resources to ideological policies as climate change, criminal justice reform, and resisting immigration enforcement (though it is not officially a “sanctuary city”).

Keep reading