The U.S. government ended its 2026 money year about $1.99 trillion in the hole, which means it spent that much more than it brought in. According to CNBC, that's roughly 12% worse than last year, and only the pandemic years of 2020 and 2021 were bigger. It's been 25 years straight of spending more than it earns. The last time the books balanced was 2001, before most of us were born.

So where's it all going? Social Security takes the biggest chunk at about $1.7 trillion, Medicare is next at nearly $1.1 trillion, and just paying interest on the debt now tops $1 trillion. Total debt is above $40 trillion, double what it was ten years ago. Income taxes helped, bringing in over $2.8 trillion, but corporate tax money dropped by about $70 billion after tax cuts passed last year.

Tariffs were pitched as the fix, and the government did collect record duties on paper. Then the Supreme Court ruled that many of them were unconstitutional, so billions had to be refunded to retailers, which ate into the gains. Treasury Secretary Scott Bessent says the U.S. can "grow our way out" of the debt. Bond investors seem less sure: last week they pushed long-term borrowing rates to their highest in 24 years.