US Interest on the Debt Passed Defense Spending in 2026

Analysis. Every figure below is sourced in the box at the end. The facts are laid out; the conclusion is yours.

In the United States, the federal government spent an estimated $1,143 billion on net interest on the public debt in fiscal year 2026, which ended September 30. The Congressional Budget Office (CBO) puts spending on military activities at the Department of Defense at $916 billion. Interest was larger by $227 billion. Both numbers come from the same CBO table, so they can be compared directly.

The numbers in one place

According to CBO's Monthly Budget Review published October 8, 2026, the deficit for fiscal 2026 was $1,993 billion, or about $2.0 trillion, which is $218 billion more than the $1,775 billion recorded in fiscal 2025. Receipts rose $169 billion (3 percent) to $5,403 billion. Outlays rose $386 billion (6 percent) to $7,396 billion.

Net interest rose from $1,028 billion to $1,143 billion, an increase of $115 billion or 11 percent. That is about 30 percent of the whole $386 billion rise in outlays. CBO gives two reasons: the debt was larger than a year earlier, and long term interest rates were higher. Lower short term rates partly offset the increase.

A few ratios follow from CBO's own totals. Net interest was about 15 percent of all outlays (1,143 divided by 7,396) and about 21 percent of receipts (1,143 divided by 5,403). It also equaled a little over half of the deficit (1,143 divided by 1,993).

Where the other big lines moved

Interest is not the only line that grew. Social Security benefits rose $86 billion (5 percent) to $1,654 billion, Medicare rose $77 billion (8 percent) to $1,069 billion, and Medicaid rose $55 billion (8 percent) to $723 billion. Defense rose $48 billion (5 percent). On the receipts side, individual income and payroll taxes together rose $255 billion, while corporate income taxes fell $70 billion (16 percent) and customs duties fell $22 billion (11 percent). CBO attributes the customs drop to about $130 billion in refunds of tariffs collected under the International Emergency Economic Powers Act, after a February 2026 Supreme Court decision.

Readers will draw different lessons from the same table. Some will point to the interest line and argue that borrowing is crowding out other priorities. Others will point to the benefit programs and the tax changes and argue that the gap between receipts and outlays, not the interest bill alone, is the underlying issue. The table supports describing all of these movements; it does not rank which one should be changed.

The questions that remain

If interest keeps growing faster than receipts, which other lines have to give, or does the deficit simply widen? How much of the 2026 increase came from the size of the debt and how much from interest rates, and which of the two can policy influence? Does comparing interest with defense say something about priorities, or is it only a convenient yardstick, since the two serve different purposes? And what would a plan look like that a majority in Congress could support on both the spending side and the revenue side?

For a related look at the other side of the ledger, see what the Treasury series shows about how fast the debt grew. The next checkable point is CBO's next Monthly Budget Review, which will start the fiscal 2027 count.