Politicians and pundits love to invoke the national debt whenever it suits their argument. They point fingers across the aisle, warn about what we owe foreign creditors, and promise fiscal responsibility. Yet for all the rhetoric, no one in modern memory has actually fixed the problem while in office.
Only one president in American history ever managed to eliminate the national debt entirely: Andrew Jackson. He has since earned far more fame as a villain than as a fiscal hero, and with good reason. But the story of how he zeroed out the debt, and what happened immediately after, remains one of the most instructive cautionary tales in U.S. economic history.
So when, exactly, was the United States debt-free? How did Jackson pull it off? And what were the consequences?
Why Are We Talking About This?
A bag of debt weighed against the globe.
The debate around national debt and the risks it carries is very much alive today. As of early July 2026, the U.S. gross national debt stood at approximately $39.4 trillion, according to U.S. Treasury Fiscal Data, driven by rising interest costs and mandatory spending that continues to outpace revenue. Nobody can say with certainty what the long-term damage of such massive accumulated borrowing will ultimately look like, but the warning signs are growing louder by the month.
Why Is National Debt Important?
A politician with no money.
Government borrowing has historically been a useful tool in nation-building, allowing states to fund wars, infrastructure, and crises. The concern arises when debt becomes structural rather than temporary. The Congressional Budget Office’s February 2026 baseline projects debt held by the public at 101% of GDP by the end of 2026, with that figure surpassing the post-World War II record of 106% as early as 2030. At those levels, the government’s capacity to respond to future emergencies begins to erode in measurable ways.
The crowding-out effect is also real. As government borrowing grows, private investment tends to shrink because interest rates must rise to compete for a finite pool of capital. With the average interest rate on marketable Treasury debt running at 3.411% as of June 2026, the cost of servicing the debt has become one of the fastest-growing line items in the federal budget. In fiscal year 2024, net interest payments hit $950 billion, surpassing Pentagon discretionary spending of $826 billion for the first time in modern history. The CBO projects net interest will consume $1.0 trillion in FY2026 alone.
When Was the United States Debt-Free?
A bill past due.
President Andrew Jackson was inaugurated in 1829 and immediately set his sights on eliminating the national bank. As part of that campaign, he transferred federal funds into state-chartered “pet banks” across the country. Those banks, flush with new deposits, poured money into land speculation, which temporarily flooded the U.S. Treasury with cash from surging land sales.
By January 1835, Jackson had achieved what no president before or since has managed: the national debt reached zero. The celebration was short-lived. To rein in the land speculation his own policies had unleashed, Jackson issued the Specie Circular in 1836, requiring all federal land purchases to be made in gold or silver. The order drained hard currency from eastern banks, froze credit markets, and triggered the Panic of 1837. The depression that followed forced the federal government to start borrowing again almost immediately, and the debt has never returned to zero since.
History of United States Debt
Becoming debt-free is more difficult than ever.
Since the 1830s, the national debt has ballooned most dramatically during wartime and economic collapse. It reached $2.7 billion in the aftermath of the Civil War and soared to $251 billion, representing 112% of GDP, by the time World War II ended in 1945. The decades that followed brought sustained fiscal discipline: the debt-to-GDP ratio fell to roughly 33% by the late 1990s under the Clinton administration, aided by a booming economy and consecutive budget surpluses.
That progress unraveled quickly. Tax cuts, two prolonged Middle East conflicts, the 2008 financial crisis, and the COVID-19 pandemic pushed borrowing to levels that would have been unthinkable a generation ago. As of early July 2026, the gross national debt stands at approximately $39.4 trillion. Looking ahead, the CBO’s February 2026 baseline projects gross federal debt reaching $63.7 trillion by 2036 under current law. That trajectory worsened further after the passage of the One Big Beautiful Bill Act: on a dynamic basis, the CBO estimates the law will add $4.7 trillion to deficits over the 2026 through 2035 budget window.
Background on Andrew Jackson
A statue of President Andrew Jackson.
Jackson’s legacy is deeply polarizing. He was the only president to zero out the national debt, yet his presidency is also defined by the forced removal of Native Americans from their ancestral homelands. The Trail of Tears, which resulted in the deaths of thousands of Indigenous people east of the Mississippi, is now considered one of the most egregious acts of government-sanctioned violence in U.S. history. That record has long fueled a movement to remove his image from the $20 bill.
The effort to replace Jackson with abolitionist Harriet Tubman has endured a decade of stops and starts. The Obama administration first announced the redesign in April 2016, originally targeting a 2020 debut to coincide with the centennial of women’s suffrage. During Trump’s first term, Treasury Secretary Steven Mnuchin pushed the project back to 2028, citing anti-counterfeiting upgrades. The Biden administration revived it in January 2021, with Treasury Secretary Janet Yellen eventually setting a target of 2030 for the Tubman $20 to enter circulation. That plan is now dead. On July 7, 2026, Treasury Secretary Scott Bessent confirmed that the Trump administration has scrapped it entirely, saying the department is “not at present” planning to put Tubman’s likeness on the bill. The announcement formally ended a push that had been underway for more than a decade.
Tubman would have been the first African American to appear on U.S. paper currency. Her record as an Underground Railroad conductor who led dozens of enslaved people to freedom stands in stark contrast to Jackson’s legacy, which is why the debate over whose face belongs on the nation’s money continues to resonate well beyond questions of design or aesthetics.
Editor’s note: This article has been updated to reflect the gross national debt rising to approximately $39.4 trillion as of early July 2026 (per the Joint Economic Committee’s July 2026 Monthly Debt Update), the average interest rate on marketable Treasury debt reaching 3.411% as of June 2026, and the Trump administration’s formal announcement on July 7, 2026 that it has scrapped plans to place Harriet Tubman on the $20 bill.
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