Treasury's Bessent says upsized bond buybacks could increase further

A day after total U.S. public debt outstanding crossed the symbolic $40 trillion threshold, Bessent said he and White House budget director Russell Vought will be embarking on a new fiscal consolidation effort directed by President Donald Trump, and that combined with efforts to cut waste, fraud and abuse, savings of "several hundred billion dollars" could be found.

He added that there was "nothing magic about the $40 trillion figure" and that the U.S. would grow its way out of the debt. In the meantime, he said that the deficit this year has been pushed up by refunds of Trump's tariffs declared illegal by the Supreme Court, a phenomenon that would not be repeated next year, as new tariffs are being implemented under other trade laws that have withstood court challenges.

He added that he expected 2026 tariff revenues to match those of 2025, but did not specify whether he was referring to calendar or fiscal years.

Also curbing revenues is a wave of factory and data center construction that is being immediately expensed against corporate profits under the Republican 2025 tax cut act, causing a drop in corporate tax revenues, Bessent said.