Donald Trump proposes $5 trillion increase to federal borrowing limit

President Donald Trump is advocating for a third budget reconciliation package to increase the federal borrowing limit by $5 trillion through 2029. The proposal aims to prevent future legislative friction with Democrats should they regain control of Congress.

To pass the measure, the administration must secure support from all Senate and House Republicans, a goal some lawmakers consider unlikely. Senator Thom Tillis has expressed opposition, stating that raising the limit contradicts efforts to curb the national debt, which recently exceeded $40 trillion.

Market volatility has been noted, with the 30-year Treasury bond yield recently reaching 5.3 percent. In response to market turmoil, Treasury Secretary Scott Bessent doubled the limit on government debt buybacks, though bond yields remain elevated.