On August 19, 2026, the United States national debt officially crossed the $40 trillion mark. The number has become so large that it risks becoming meaningless. That is precisely why it matters.

Forty trillion dollars is no longer a projection or a warning about the future. It is the Treasury’s current balance-sheet reality. This is not merely an abstract problem for Washington to manage. It is a structural reality with direct consequences for the global financial system. Nor is it abstract to foreign governments, central banks and investors that hold a substantial share of the Treasury securities issued to the public. They are watching the numbers as closely as the Treasury Department itself.

The Warning That Was Ignored

During his first presidential campaign, Donald Trump warned that a national debt approaching $24 trillion would represent America’s “point of no return.” “That’s when we become Greece,” he said. “That’s when we become a country that’s unsalvageable.” Since Trump made that warning, total federal debt has risen by more than $16 trillion.

Trump was not the first to warn about the trajectory of US borrowing, and he will not be the last. His successors, both Republican and Democratic, have continued the same pattern of spending that he criticized as a candidate and then presided over as president. The debt has grown under every administration, in good times and bad, in war and peace, with bipartisan consistency. The machinery of deficit spending is not a bug in the system. It is the system.

When Interest Becomes the Problem

The scale of the problem is difficult to grasp because the numbers have lost any connection to lived experience. The debt-to-GDP ratio now stands at approximately 123 percent, a level that was once considered a warning sign for developed economies but has become almost normalized in the United States. Annual deficits remain in the range of $2 trillion even when unemployment is low and the economy is not in recession. The structural gap between what the government collects and what it spends is not a temporary phenomenon driven by emergency measures. It is baked into the budget.

One of the most consequential changes in the federal budget is the rise of interest payments. At more than $1 trillion per year, interest payments now rival defence spending and consume more federal resources than many major government functions combined. The more the government borrows, the larger the interest burden becomes, narrowing the fiscal space available for everything else and making further borrowing increasingly difficult to escape. The mechanism does not require malice or incompetence. It only requires the continuation of existing policies.

The United States is not Greece, and its advantages are vastly greater. But the mechanism of political postponement is familiar: borrowing remains easier than confronting the tax and spending choices required to change the trajectory.

The Dollar’s Dilemma

The central mistake in much of the Western discussion about de-dollarisation is the assumption that the dollar must first be replaced by another single currency. It does not.

A multipolar financial system does not require the renminbi to become a new dollar. The more significant development is the gradual fragmentation of a system in which an increasing share of international trade, reserves and financial transactions no longer requires the dollar at all. That process is already underway.

China and Russia have expanded the use of national currencies in bilateral trade. India has pursued local-currency settlement with selected partners. Central banks have increased their gold holdings while diversifying across a wider range of assets and currencies. Regional payment systems, bilateral swap arrangements and alternative settlement mechanisms are developing alongside the Western financial architecture.

None of these developments, taken individually, will end the dollar’s global role. Taken together, however, they are changing the question. The issue is no longer simply what currency could replace the dollar. The more important question is how many transactions can gradually be conducted without it.

China’s role is particularly important in this process. The renminbi does not need to become the world’s dominant reserve currency in order to become increasingly important. China’s economic scale, its trading relationships and its position at the centre of Eurasian and Global South economic networks allow the currency to expand its role gradually, particularly in trade and bilateral settlement.

For many governments, the attraction is not ideological. It is practical. A government does not need to believe that Beijing represents a better political model than Washington in order to prefer a financial system in which access to trade and payments is less dependent on a single external power.

That is the deeper meaning of de-dollarisation. Not the sudden collapse of the dollar. The gradual construction of a world in which the dollar is no longer the automatic starting point.

The Quiet Shift in Global Reserves

The erosion is already visible in the behaviour of foreign central banks. Over the past decade, the composition of official reserves has gradually become more diversified. Gold holdings have increased, some major economies have reduced their Treasury exposure, and central banks have shown greater interest in spreading reserves across a wider range of assets and currencies. The process is uneven, and it is not equivalent to an imminent abandonment of the dollar. But the direction is clear enough.

The pace of this diversification accelerated after the freezing of Russian assets in 2022, which demonstrated that assets held within the Western financial system could be weaponized against sovereign states. For many governments, the lesson was not that US Treasuries had suddenly become credit-risky. It was that reserves held inside Western financial institutions could carry political and jurisdictional risks that had previously been easier to ignore.

The Multipolar Calculation

From Beijing and Moscow to parts of the Gulf, the calculation increasingly includes the same question: how much national wealth should remain concentrated inside a financial system ultimately governed by Washington’s fiscal choices, monetary policy, sanctions regime and legal jurisdiction? India has pursued its own, more cautious version of diversification through local-currency settlement and broader reserve management. The shift is not ideological. It is actuarial.

The multipolar world that has emerged over the past two decades is not simply a geopolitical rearrangement. It is also a financial one. The BRICS countries, the Gulf states, and other major economies have been developing alternative payment systems, bilateral swap arrangements, and settlement mechanisms that bypass the dollar. These efforts are often described in the West as attempts to undermine the dollar, but that framing is misleading. They are attempts to reduce vulnerability to a system in which one country’s fiscal and monetary decisions, sanctions policy and financial jurisdiction can have outsized consequences for everyone else. The distinction matters. It is the difference between an attack and an insurance policy.

The Point of No Return

At $40 trillion, the U.S. national debt is no longer merely an American domestic problem. It is a central component of the global financial system and a liability of the U.S. government held, directly or indirectly, across the world. Those holders are not about to dump their Treasuries in a panic. But they are increasingly asking themselves whether the rate of return they receive adequately compensates for the risks they are taking. The answer, for many of them, is becoming less clear.

The threshold Trump described as America’s point of no return has been crossed, and crossed decisively. The United States has not become Greece, but the structural resemblance is becoming harder to ignore: a political system that repeatedly postpones difficult fiscal choices while the debt burden continues to grow. The difference, for now, is that the United States issues the world’s reserve currency, which gives it a longer runway than any other country.

How long that runway remains usable is no longer a question of American fiscal policy alone. It also depends on how much of the growing burden can continue to be absorbed by domestic investors and how quickly the rest of the world decides that dependence on a debt-heavy, politically weaponized financial system has become a risk worth reducing.

Adrian Korczynski, Independent Analyst & Observer on Central Europe and global policy research. Courtesy

https://journal-neo.su/2026/09/28/americas-40-trillion-debt-the-point-of-no-return-has-arrived/