Ongoing large federal budget deficits, projected by the CBO at $1.9 trillion for fiscal year 2026 and widening thereafter, continue to drive steady increases in gross federal debt, which stood near $39.8 trillion in mid-2026. The 2025 reconciliation act expanded outlays for defense, border security, and other priorities while adding significantly to cumulative deficits over the decade, offset only partially by tariff revenue gains. With debt held by the public already at or above 100 percent of GDP and the statutory limit recently raised to $41.1 trillion, baseline projections show no near-term reversal, as mandatory spending on entitlements and net interest outpace revenue growth. Congressional budget resolutions and appropriations processes through late 2026 offer limited scope for major deficit reduction before the next debt-ceiling deadline.