Treasury Secretary Scott Bessent told reporters Thursday that the United States must grow its way out of its national-debt problem, after gross federal debt surpassed $40 trillion earlier this week.
Bessent went on to distinguish between debt held by the public and intragovernmental debt, including obligations held by federal trust funds such as Social Security. He also argued that tariff refunds the Trump administration has been forced to issue following the Supreme Court’s ruling have worsened the debt picture. According to Bessent, the administration’s new Section 301 tariffs should restore federal revenue to its pre-ruling level.
He also blamed the Biden administration for helping produce what he described as the highest deficit-to-GDP ratio in American history.
Reporter: “The $40T mark that we passed for the national debt. Would you comment on that and how do we reverse that?”
— RedWave Press (@RedWavePress) August 20, 2026
Treasury Secretary Scott Bessent: “The $40T is a big number. It’s smaller when we look at the publicly traded amount… We’re going to have to grow our way out… pic.twitter.com/2zKg6tlduL
"The $40 trillion mark that we passed for the national debt, would you comment on that and how do we reverse that?"
"Yeah, look, the $40 trillion is a big number. It is smaller when we look at the publicly traded amount because our Social Security funds and other government entities hold a substantial amount. And what we're going to do, we're going to have to grow our way out of this," the Treasury Secretary said. "And as I talked about at G20 in Asheville, we are going to talk about the US growth strategy and encourage the rest of the world to come along with us."
"We are also, you know, I announced that Director Russ Vought and I have been tasked with looking at fiscal consolidation. I think the numbers [we] have, are not the actual numbers now. We've had to do substantial tariff refunds due to the court ruling. But with the Section 301 tariffs, I am confident that we will be back to the same level, if not higher, of tariff income for last year. And that is most of the increase in the deficit," Bessent added. "And remember, we did not get here in a day that we were left with a mess. The Biden administration had the highest deficit to GDP in history when we weren't at war or weren't in a recession. For 2025, we brought it down by more than a percent."
We may need to grow our way out of the deficit, but the real problem lies in spending.
America has always grown. Yet every time the country becomes more prosperous, Washington seems to discover a new excuse to spend even more. The Democratic Socialists of America (DSA) embody that impulse to its fullest extent, because whenever Americans create more wealth, they see it as yet another pot of money to redistribute to an ever-expanding welfare state.
This problem has been building for decades. Until the country is willing to confront the reality that we spend too much, rely too heavily on government, and prioritize today’s benefits over the future we leave behind, the debt crisis will not change course.
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