04/09/2023 02:17 Understanding the National Debt | U.S.

Treasury Fiscal Data

We can do this. Find COVID-19 vaccines near you. Visit Vaccines.gov

An official website of the U.S. government
Menu

Overview Revenue Spending Deficit Debt

What is the national debt?

The national debt ($32.91 T) is the total amount of outstanding borrowing
by the U.S. Federal Government accumulated over the nation’s history.

$3 2 , 9 1 4 , 1 4 9 , 3 6 3 , 7 6 0
Updated daily from the Debt to the Penny dataset.

Share this page:

Key Takeaways
Facebook

Twitter
The National Debt Explained
LinkedIn

Funding Programs & Services Reddit

Email
The Growing National Debt Key Takeaways
Breaking Down the Debt The national debt is composed of distinct types of debt, similar to an
individual whose debt may consist of a mortgage, car loan, and credit
cards. The different types of debt include non-marketable or
The Debt Ceiling marketable securities and whether it is debt held by the public or
debt held by the government itself (known as intragovernmental).

Tracking the Debt The U.S. has carried debt since its inception. Debts incurred during the
American Revolutionary War amounted to $75 million, primarily
borrowed from domestic investors and the French Government for war
Dive Deeper into the Debt materials.

The national debt enables the federal government to pay for importan
programs and services for the American public.

https://fiscaldata.treasury.gov/americas-finance-guide/national-debt/ 1/12
04/09/2023 02:17 Understanding the National Debt | U.S. Treasury Fiscal Data

The National Debt Explained

The national debt is the amount of money the federal government has
borrowed to cover the outstanding balance of expenses incurred over
time. In a given fiscal year (FY) , when spending (ex. money for
roadways) exceeds revenue (ex. money from federal income tax), a
budget deficit results. To pay for this deficit, the federal government
borrows money by selling marketable securities such as Treasury
bonds , bills , notes , floating rate notes , and
Treasury inflation-protected securities (TIPS) . The national debt is the
accumulation of this borrowing along with associated interest owed to
the investors who purchased these securities. As the federal government
experiences reoccurring deficits, which is common, the national debt
grows.

Simply put, the national debt is similar to a person using a credit card for
purchases and not paying off the full balance each month. The cost of
purchases exceeding the amount paid off represents a deficit, while
accumulated deficits over time represents a person’s overall debt.

The U.S. Treasury uses the terms “national debt,” “federal debt,” and
“public debt” interchangeably.

Revenue Spending Deficit

Year 1 $400 $500 -$100
Year 2 $600 $800 -$200
-$300 Debt

Funding Programs & Services

The federal government needs to borrow money to pay its bills when its
ongoing spending activities and investments cannot be funded by federal
revenues alone. Decreases in federal revenue are largely due to either a
decrease in tax rates or individuals or corporations making less money.
The national debt enables the federal government to pay for important
programs and services even if it does not have funds immediately
available, often due to a decrease in revenue. Decreases in federal
revenue coupled with increased government spending further increases
the deficit.

Consistent with the purpose of the federal government established by the

U.S. Constitution, money is spent on programs and services to ensure the
well-being of U.S. residents. The Constitution’s preamble states that the
purpose of the federal government is “…to establish Justice, insure
domestic Tranquility, provide for the common defense, promote the
general Welfare, and secure the Blessings of Liberty to ourselves and our
Posterity.” Uninterrupted funding of programs and services is critical to
residents’ health, welfare, and security.

https://fiscaldata.treasury.gov/americas-finance-guide/national-debt/ 2/12
04/09/2023 02:17 Understanding the National Debt | U.S. Treasury Fiscal Data

What are some of the major spending categories?

Below are some of the federal government’s largest spending

categories. Visit USAspending.gov to explore federal spending by
the types of items and services purchased by the federal
government. Explore federal spending by Object Class or learn how
spending categories and subcategories break down by viewing
federal spending by Budget Function.

Income Security
Supports programs such as unemployment compensation,
federal employee retirement and disability, and food and
nutrition assistance; spending for this program increased
during the COVID-19 pandemic because of the CARES Act
and American Rescue Plan Act
Social Security
Supports programs for beneficiaries including retirement,
disability insurance, and supplemental security income
payments
Health
Supports spending for programs related to health care
services, health research and training, and consumer and
occupational health and safety, except for Medicare which
has its own category
National Defense
Supports spending related to the military and defense-
related activities
Medicare
Supports spending programs providing health insurance for
people such as those aged 65 or older and certain younger
people with disabilities

In accordance with the 2014 DATA Act, federal agencies are

required to submit financial data on a quarterly and/or
monthly basis to USAspending.gov. Anyone can visit
USAspending for a breakdown of what the federal
government spends each year and how it spends that
money. Visitors can follow the money from the
Congressional appropriations to the federal agencies and
down to local communities and businesses.

The Growing National Debt

The U.S. has carried debt since its inception. Debts incurred during the
American Revolutionary War amounted to over $75 million by January 1,
1791. Over the next 45 years, the debt continued to grow until 1835 when
https://fiscaldata.treasury.gov/americas-finance-guide/national-debt/ 3/12
04/09/2023 02:17 Understanding the National Debt | U.S. Treasury Fiscal Data

it notably shrank due to the sale of federally-owned lands and cuts to the
federal budget. Shortly thereafter, an economic depression caused the
debt to again grow into the millions. The debt grew over 4,000% through
the course of the American Civil War, increasing from $65 million in 1860
to $1 billion in 1863 and around $2.7 billion shortly after the conclusion of
the war in 1865. The debt grew steadily into the 20th century and was
roughly $22 billion after the country financed its involvement in World
War I.

Notable recent events triggering large spikes in the debt include the
Afghanistan and Iraq Wars, the 2008 Great Recession, and the COVID-19
pandemic. From FY 2019 to FY 2021, spending increased by about 50%,
largely due to the COVID-19 pandemic. Tax cuts, stimulus programs,
increased government spending, and decreased tax revenue caused by
widespread unemployment generally account for sharp rises in the
national debt.

U.S. National Debt Over the Last 100 Years

Inflation Adjusted - 2022 Dollars

2022 $30.93 T
Fiscal Year Total Debt

$35 T

$30 T

$25 T

$20 T

$15 T

$10 T

$5 T

$0
1922 1942 1962 1982 2002 2022

Visit the Historical Debt Outstanding dataset to explore and download this
data. The inflation data is sourced from the Bureau of Labor Statistics.

Last Updated: September 30, 2022

Over the past 100 years, the U.S. federal debt has increased from $408 B
in 1922 to $30.93 T in 2022.

Comparing a country’s debt to its gross domestic product (GDP)

reveals the country’s ability to pay down its debt. This ratio is considered

https://fiscaldata.treasury.gov/americas-finance-guide/national-debt/ 4/12
04/09/2023 02:17 Understanding the National Debt | U.S. Treasury Fiscal Data

a better indicator of a country’s fiscal situation than just the national debt
number because it shows the burden of debt relative to the country’s tota
economic output and therefore its ability to repay it. The U.S. debt to GDP
ratio surpassed 100% in 2013 when both debt and GDP were
approximately 16.7 trillion.

Federal Debt Trends Over Time, FY 1948 – 2022

Debt to Gross Domestic Product (GDP)

2022 124%
Fiscal Year Debt to GDP

140%

120%

100%

80%

60%

40%

20%

0%
1950 1960 1970 1980 1990 2000 2010 2020

Visit the Historical Debt Outstanding dataset to explore and download this
data. The GDP data is sourced from the Bureau of Economic Analysis.

Last Updated: September 30, 2022

When adjusted for inflation, the U.S. federal debt has steadily increased
since 2001. Without adjusting for inflation, the U.S. federal debt has
steadily increased since 1957. Another way to view the federal debt over
time is to look at the ratio of federal debt related to GDP. This ratio has
generally increased since 1981.

Visualizing the debt - How much is $33 trillion dollars?

Breaking Down the Debt

The national debt is composed of distinct types of debt, similar to an
individual whose debt consists of a mortgage, car loan, and credit cards.
https://fiscaldata.treasury.gov/americas-finance-guide/national-debt/ 5/12
04/09/2023 02:17 Understanding the National Debt | U.S. Treasury Fiscal Data

The national debt can be broken down by whether it is non-marketable or

marketable and whether it is debt held by the public or debt held by
the government itself (known as intragovernmental ). The national
debt does not include debts carried by state and local governments, such
as debt used to pay state-funded programs; nor does it include debts
carried by individuals, such as personal credit card debt or mortgages.

The visual below comparing calendar year 2013 and 2023 displays the
difference in growth between debt held by the public and
intragovernmental debt. While both types of debt combine to make up th
national debt, they have increased by different amounts in the past
several years. One of the main causes of the jump in public debt can be
attributed to increased funding of programs and services during the
COVID-19 pandemic. Intragovernmental debt has not increased by quite
as much since it is primarily composed of debt owed on agencies’ excess
revenue invested with the Treasury. The revenue of the largest investor in
Treasury securities, the Social Security Administration, has not increased
significantly in recent years, resulting in this slower intragovernmental
holding increase.

Intragovernmental Holdings and Debt Held by the Public,

CY 2013 and CY 2023

$25.71 T

$11.92 T

$6.90 T
$4.82 T
2013 2023

Intragovernmental Holdings Debt Held by the Public

Visit the U.S. Treasury Monthly Statement of the Public Debt (MSPD) to
explore and download this data.

Last Updated: July 31, 2023

There are two major categories for federal debt: debt held by the public
and intragovernmental holdings.

The debt held by the public has increased by 116% since 2013.
Intragovernmental holdings increased by 43% since 2013.

https://fiscaldata.treasury.gov/americas-finance-guide/national-debt/ 6/12
04/09/2023 02:17 Understanding the National Debt | U.S. Treasury Fiscal Data

Maintaining the National Debt

The federal government is charged interest for the use of lenders’ money,
in the same way that lenders charge an individual interest for a car loan o
mortgage. How much the government pays in interest depends on the
total national debt and the various securities’ interest rates .

As of July 2023 it costs $726 billion to maintain the debt, which is 14% of
the total federal spending.

The national debt has increased every year over the past ten years.
Interest expenses during this period have remained fairly stable due to
low interest rates and investors’ judgement that the U.S. Government has
a very low risk of default. However, recent increases in interest rates and
inflation are now resulting in an increase in interest expense.

Interest Rate and Total Debt, 2013 – 2022

2022 2.07% $30.93 T

Fiscal Year Average Interest Rate Total Debt

2.43%

2.07%

$16.74 T

$30.93 T

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022

Average Interest Rate Total Debt

Visit the Average Interest Rates on U.S. Treasury Securities and U.S.
Treasury Monthly Statement of the Public Debt (MSPD) datasets to explore
and download this data.

Last Updated: September 30, 2022

When interest rates remain low over time, interest expense on the debt
paid by the federal government will remain stable, even as the federal
debt increases. As interest rates increase, the cost of maintaining the na
tional debt also increases.

https://fiscaldata.treasury.gov/americas-finance-guide/national-debt/ 7/12
04/09/2023 02:17 Understanding the National Debt | U.S. Treasury Fiscal Data

Why can't the government just print more money?

While the Treasury prints actual dollar bills, “printing money” is

also a term that is sometimes used to describe a means of
monetary policy which is conducted by the Federal Reserve.
Monetary policy involves controlling the supply of money and the
cost of borrowing. The Federal Reserve uses monetary policy to
promote maximum employment, stable prices, and moderate long-
term interest rates on the behalf of Congress. The federal
government uses fiscal policy, or the control of taxation and
government spending, to promote economic activity.

The Debt Ceiling

The debt ceiling, or debt limit, is a restriction imposed by Congress on the
amount of outstanding national debt that the federal government can
have. The debt ceiling is the amount that the Treasury can borrow to pay
the bills that have become due and pay for future investments. Once the
debt ceiling is reached, the federal government cannot increase the
amount of outstanding debt, losing the ability to pay bills and fund
programs and services. However, the Treasury can use extraordinary
measures authorized by Congress to temporarily suspend certain
intragovernmental debt allowing it to borrow to fund programs or
services for a limited amount of time after it has reached the ceiling.

Since the United States has never defaulted on its obligations, the scope
of the negative repercussions related to a default are unknown but would
likely have catastrophic repercussions in the United States and in markets
across the globe.

How is the debt ceiling different from a government

shutdown?

Government shutdowns occur when annual funding for ongoing

federal government operations expires, and Congress does not
renew it in time.

Tracking the Debt

Created in 2012 and operating under the Department of the Treasury, the
Bureau of the Fiscal Service manages all federal payments and collections
and provides government-wide accounting and reporting services. A
primary function of the Fiscal Service is to account for and report the
national debt, as dictated by the U.S. Constitution, which states that
“regular Statement and Account of the Receipts and Expenditures of all
public Money shall be published from time to time.”
https://fiscaldata.treasury.gov/americas-finance-guide/national-debt/ 8/12