The debt ceiling, also known as the debt limit, is the maximum amount of money that the U.S. Treasury can borrow. Increasing the debt ceiling allows the Treasury to borrow funds to pay for government obligations that have already been incurred as the result of laws and budgets approved by the President and the Congress.
Legislation signed into law in July 2025 extends the debt ceiling by $5 trillion — from $36.1 to $41.1 trillion.
Why is understanding the debt ceiling important and what are the implications for our economy and our fiscal condition? The infographic below explains. For more details, see our analysis on the debt ceiling.
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Further Reading
What Is Budget Reconciliation?
The reconciliation process avoids the potential need to gather 60 votes to end debate and, therefore, allows the Senate to adopt legislation with a simple majority.
Budget Basics: National Defense
The national defense budget funds a wide range of activities and represents a significant share of overall federal spending.
Spending on Veterans in the Budget
This piece examines spending on veterans within the budget and outlines the factors that have pushed it higher in recent years.