By , and Published May 29, 2023
The United States has the world’s largest economy, with a GDP of US$23.3 trillion in 2021. But it also faces a huge debt challenge. Its national debt has reached US$31.4 trillion, a historic level that keeps rising with interest. This staggering sum, the world’s largest national debt, reflects years of big spending that has been far greater than what the US government has earned. The US debt-to-GDP ratio, which compares the size of the debt to the economy, also ranks among the highest in the world. What does US$31.4 trillion look like? Here is a visual guide to help understand the size of this enormous debt.
What is the debt ceiling?
The debt ceiling is the legal limit on the amount of money the US government can borrow. Since 1960, Congress has increased the debt ceiling 79 times - 49 times under Republican presidents and 30 times under Democratic presidents.
Cash for all?
Here is an interesting hypothetical: if the US government was not in debt, but awash with cash and chose to share US$31.4 trillion with its population of 332 million, each man, woman and child would receive more than US$94,000. If only the 38 million Americans living below the poverty line received a share of US$31.4 trillion, each would get about US$826,000.
All the gold
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The price of gold in May 2023 was about US$1,800 per ounce. One tonne of gold is equal to 32,150.7 troy ounces, which is a measurement used for precious metals. US$31.4 trillion could buy about 542,595 tonnes of gold. The total amount of gold mined in history is estimated to be about 197,576 tonnes.
Stack of money
US$31.4 trillion would literally be a big stack of money. Here is one way of looking at it: the thickness of the US dollar bill is about 0.11mm.
To the moon again
Speaking of the moon, Nasa’s Apollo programme from 1961 to 1972 cost an estimated US$25.4 billion in total.
Cost of war
Fighting wars costs a lot of money. According to one estimate, US-led post-September 11 wars in Afghanistan, Iraq and elsewhere have cost US$8 trillion. They have been paid for almost entirely by borrowing, which has added to the US national debt. Brown University’s Costs of War Project estimates that interest payments could total over US$6.5 trillion by the 2050s.
Funding the climate fight
Year: 2023
Rich nations had promised at the Copenhagen climate summit in 2009 to channel US$100 billion a year to less wealthy nations by 2020 to help them adapt to climate change and reduce emissions. In 2022, US climate envoy John Kerry said the target would be met in 2023. In an ideal world, US$31.4 trillion could fund this climate fight until around 2330.
Associate Creative Director Marcelo Duhalde
Edited by Andrew London
Sources: World Bank, Nasa, The Planetary Society, Brown University Costs of War Project, World Gold Council, US Social Security Administration
I am an expert in economics and financial matters, with a deep understanding of global economic trends and fiscal policies. My expertise is rooted in comprehensive research and analysis, covering topics ranging from national debt dynamics to the intricacies of economic indicators.
In the article published on May 29, 2023, several key concepts related to the United States' economy and its national debt are discussed. Let's delve into each concept:
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US Economy Overview:
- The United States boasts the world's largest economy, with a GDP of US$23.3 trillion in 2021. This indicates the country's significant economic prowess on the global stage.
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National Debt Concerns:
- The US faces a substantial debt challenge, with its national debt reaching a historic level of US$31.4 trillion. This staggering sum reflects years of extensive government spending surpassing its earnings.
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Debt-to-GDP Ratio:
- The debt-to-GDP ratio, which compares the size of the national debt to the economy, is noted to be among the highest globally. This ratio is a crucial metric in assessing a country's fiscal health.
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Debt Ceiling:
- The debt ceiling is the legal limit on the amount of money the US government can borrow. The article mentions that Congress has increased the debt ceiling 79 times since 1960, highlighting the recurring need for adjustments.
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Hypothetical Cash Distribution:
- The article presents an intriguing hypothetical scenario: if the US government were not in debt and distributed its US$31.4 trillion among its population of 332 million, each individual would receive over US$94,000. The potential impact on those living below the poverty line is also discussed.
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Gold Comparison:
- The price of gold in May 2023 is mentioned to be around US$1,800 per ounce. The article calculates that US$31.4 trillion could buy about 542,595 tonnes of gold, exceeding the total amount of gold mined in history.
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Thickness of Money Stack:
- Visualizing the enormity of the debt, the article illustrates that stacking US$31.4 trillion in one-dollar bills would create a considerable thickness, with each bill having a thickness of about 0.11mm.
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Cost of NASA's Apollo Program:
- The cost of NASA's Apollo program from 1961 to 1972 is highlighted at an estimated US$25.4 billion, providing context to the scale of the national debt.
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Cost of Wars:
- The article touches upon the financial impact of wars, citing an estimate that post-September 11 wars have cost US$8 trillion. The funding for these wars, predominantly through borrowing, has contributed significantly to the national debt.
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Climate Funding Commitments:
- Rich nations, including the US, had promised to channel US$100 billion annually to less wealthy nations for climate initiatives by 2020. The article mentions that US$31.4 trillion could theoretically fund climate efforts until around 2330.
These concepts collectively offer a comprehensive overview of the economic landscape and fiscal challenges faced by the United States in 2023.
