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The U.S. national debt has jumped past $37 trillion as of August 12, 2025, years ahead of forecasts, according to APNews. Additionally, this rapid rise, fueled by pandemic-related borrowing and new laws adding $4.1 trillion more by 2035, now sees the country piling on $1 trillion every five months over double recent trends. For your business, these numbers are more than abstract: they signal immediate financial pressures demanding attention.
This debt explosion isn’t just a political or fiscal headline; it pushes borrowing costs higher, especially now that interest payments alone consume more federal dollars than defense or Medicaid, according to My Journal Courier. Now averaging between 6.6% and 11.5% in early 2025, depending on your lender and loan type, reported by NerdWallet. Meanwhile, SBA 7(a) loans, a traditional go-to for small businesses, are offering fixed rates in the 12.5% to 15.5% range, variable from 10.5% to 14% according to Lending Tree.
Credit is tightening, too. According to the Federal Reserve’s Senior Loan Officer Opinion Survey, about 83–87% of banks reported stricter terms, whether through higher rates, smaller lines, or tougher covenants, citing economic uncertainty as the main driver.
On the consumer side, while overall spending has held up reasonably, the trend is uneven and worrisome. Morgan Stanley projects U.S. consumer spending growth will slow down to 3.7% in 2025, down from 5.7% in 2024. Other signals show real spending barely budged; some reports are seeing as low as 0.5% growth in Q1 2025, far weaker than the 1.2% previously expected reported from Discovery Alert. And even discretionary spending is getting clipped according to the Wall Street Journal: there’s an uptick in value‑shopping and cautious consumer behavior, especially among lower and middle-income households.
The federal support system could be stretched too. In fiscal year 2024, according to APNews, the SBA backed $56 billion in small business financing and issued over 100,000 loans, its largest total since 2008, but rising interest burdens may limit future growth in that support.
Right now, higher interest rates (6–12% for typical loans, even higher for SBA, depending on option) and tighter credit conditions mean financing is both more expensive and harder to get, and that’s just going to get more intense if debt continues climbing. Consumer demand may also slow, particularly among mid to low-income customers, making sales forecasts less reliable. Even the buffer of SBA programs isn’t a sure thing, so you can’t count on backstops to stay wide open.
The $37 trillion debt is a system-wide warning reshaping loan markets, consumer habits, and the state’s ability to help. For business owners, the greatest risk is not just higher costs but being unprepared when credit tightens or demand drops. The smart move: treat this as a call to shore up cash flow, secure financing, and streamline operations now. This proactive stance is crucial; waiting for calm is no longer an option in this debt environment.