Reduce the Size and Power of the Feds

Figures on Government Spending and Debt

January 25, 2010
Associated Press


What Is Public Debt?

Public debt is the outstanding amount of money the United States government has borrowed to cover its spending. In general, the public debt grows when there is a budget deficit. The government, through the U.S. Treasury, borrows money to finance the deficit by selling Treasury securities. The government then has to pay interest to the people and organizations it borrows from, just like when businesses and consumers get a loan from their bank.

Often the government runs an annual deficit, but not always; budget surpluses, as occurred from 1998 to 2001, may be used to pay back that debt and reduce the total amount of outstanding public debt.

To gain a better understanding about which groups purchase U.S. government securities (that is, who the government is borrowing from), it is helpful to break down ownership of U.S. Treasury securities into two broad categories of debt: (1) the amount held by the Federal Reserve and Government accounts and (2) the amount that is privately held. Privately-held government debt can be subdivided into the following holders of U.S. Treasury securities:

• Depository institutions
• U.S. savings bonds
• Pension funds – private
• Pension funds – state and local governments
• Insurance companies
• Mutual funds
• State and local governments
• Foreign and international institutions
• Other investors

To Whom Do We Owe the National Debt?

The Department of the Treasury publishes The Debt to the Penny and Who Holds It. This up-to-date information divides the debt into two sections: Public and Intergovernmental Holdings. The former grouping includes domestic and foreign owned portions of the debt. The U.S. Treasury publishes Ownership of Federal Securities which is another break-down of the composition. Through combining these two data sets, as of December 2006, the composition of the U.S. National debt was:

U.S. Total Cumulative Debt Per Person

There are some suggestions that the total cumulative debt [the sum of all governmental debt plus corporate debt plus personal debt divided by the total U.S. resident population (around 305 million)] in the U.S. may be around 700,000 USD per person or about 2.17 million per U.S. census household (2.28 people per household).

WHO DO WE OWE AND HOW MUCH?