U.S. Debt: Visualizing the $31.4 Trillion Owed in 2023 (2024)

FAQs

What is the projected national debt in 2023? ›

Debt held by the public is projected to grow to $25,910 billion (98.4 percent of GDP) at the end of 2023 and $27,783 billion (102.0 percent of GDP) at the end of 2024. After 2024, debt held by the public as a percent of GDP is projected to gradually increase, reach- ing 109.8 percent in 2033.

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.

The Federal Government Has Borrowed Trillions, But Who Owns All that Debt? At the end of 2022, the nation's gross debt had reached nearly $31.4 trillion. Of that amount, about $24.5 trillion, or 78 percent, was debt held by the public — representing cash borrowed from domestic and foreign investors.

We expect the economy to soften by late 2023, driven by a slowdown in consumer spending. We expect a very modest increase in the unemployment rate, peaking at 4.1 percent in 2024. We think that the fed funds rate has already reached its terminal range for this cycle at 5.0–5.25 percent.

The debt limit caps the total amount of allowable outstanding U.S. federal debt. The U.S. hit that limit—$31.4 trillion—on January 19, 2023, but the Department of the Treasury has been undertaking a set of “extraordinary measures” so that the debt limit does not yet bind.

Eliminating the U.S. government's debt is a Herculean task that could take decades. In addition to obvious steps, such as hiking taxes and slashing spending, the government could take a number of other approaches, some of them unorthodox and even controversial. Below are some of these options.

How much money does the U.S. owe to China? China owns roughly $1.08 trillion worth of U.S. debt. 2 This amount is subject to market fluctuations. The value will change whenever China trades Treasury securities or when the prices of those bonds change.

Potential repercussions of reaching the ceiling include a downgrade by credit rating agencies, increased borrowing costs for businesses and homeowners alike, and a dropoff in consumer confidence that could shock the United States' financial market and tip its economy—and the world's—into immediate recession.

Who owns the most U.S. debt? ›

According to usafacts.org, as of January 2023, Japan owned $1.1 trillion in US Treasuries, making it the largest foreign holder of the national debt. The second-largest holder is China, which owned $859 billion of US debt.

Government Debt in Russia averaged 5277.56 RUB Billion from 2002 until 2023, reaching an all time high of 18886.19 RUB Billion in April of 2023 and a record low of 652.71 RUB Billion in February of 2003.

How much does Russia owe? About $40 billion US in foreign bonds, about half of that to foreigners. Before the start of the war, Russia had around $640 billion US in foreign currency and gold reserves, much of which was held overseas and is now frozen.

China and Japan are the largest foreign investors in American government debt. Together they own $2 trillion — more than a quarter — of the $7.6 trillion in US Treasury securities held by foreign countries.

Although it's possible, things would have to deteriorate very quickly in the economy, and the jobs market specifically, for a downturn to start this year. “We're running out of time for a 2023 recession,” Justin Wolfers, an economics professor at the University of Michigan, told CNN.

A majority of economists forecast a recession for the U.S. in 2023 – 58 percent, according to a survey from the National Association for Business Economics (NABE) released earlier this week on March 27.

That's the prediction of The Conference Board. But some economists project the U.S. will avoid a contraction in GDP altogether.

Rising debt means fewer economic opportunities for Americans. Rising debt reduces business investment and slows economic growth. It also increases expectations of higher rates of inflation and erosion of confidence in the U.S. dollar.

To pay back one million dollars, at a rate of one dollar per second, would take you 11.5 days. To pay back one billion dollars, at a rate of one dollar per second, would take you 32 years. To pay back one trillion dollars, at a rate of one dollar per second, would take you 31,688 years.

How can the US pay off its debt? ›

Raising taxes can generate revenue that the government can use to pay down debt as well as invest in programs that support the economy. But it can cut into tax revenue and hurt the economy if the government raises taxes too high. Finding the correct balance is expressed by a concept known as the "Laffer Curve."

As of January 2023, the five countries owning the most US debt are Japan ($1.1 trillion), China ($859 billion), the United Kingdom ($668 billion), Belgium ($331 billion), and Luxembourg ($318 billion).

When was the last time the U.S. was debt free? January 1835 was the first and only time all of the government's interest-bearing debt was paid off, according to the Treasury Department.

Japan tops the ranking with central government debt of 221 percent of GDP, followed by Greece, Sudan, Eritrea, and Singapore. Not long ago, the U.S. was among the least indebted countries.

United States - Federal Government; Net Worth (IMA), Level was -20997153.00000 Mil. of $ in July of 2022, according to the United States Federal Reserve.

Key Takeaways. Whether you're an American retiree or a Chinese bank, American debt is considered a sound investment. The Chinese yuan, like the currencies of many nations, is tied to the U.S. dollar. Because of varying maturities dates, China would be unable to call in all its Treasury holdings at once.

Since the government almost always spends more than it takes in via taxes and other revenue, the national debt continues to rise. To finance federal budget deficits, the U.S. government issues government bonds, known as Treasuries.

Since the U.S. dollar has a variable exchange rate, however, any sale by any nation holding huge U.S. debt or dollar reserves will trigger the adjustment of the trade balance at the international level. The offloaded U.S. reserves by China will either end up with another nation or will return back to the U.S.

According to data published by London-based investment fintech Invezz, Japan, Greece, Italy, Portugal, and the US are the top five nations with the highest level of government debt.

China buys US bonds to sustain its trade surplus with the US

Nothing can be farther from the truth. China purchases US government bonds not to accommodate US needs; instead, Beijing does so to continue running the current account surplus to provide domestic employment and relative domestic stability.

What happens if America defaults? ›

Its debt, long viewed as an ultra-safe asset, is a foundation of global commerce, built on decades of trust in the United States. A default could shatter the $24 trillion market for Treasury debt, cause financial markets to freeze up and ignite an international crisis.

The federal government borrows money from the public by issuing securities—bills, notes, and bonds—through the Treasury. Treasury securities are attractive to investors because they are: Backed by the full faith and credit of the United States government.

So if the U.S. cannot pay its creditors, interest rates on U.S. debt would go up, creating a cascade of higher interest rates. So mortgage rates, credit card rates, car loan rates. All would become more expensive. Finally, there is a real concern about the economy — that a default could spark a recession.

Because Japan exports so many goods to the U.S. and other nations, the country frequently develops an account surplus in dollars - the currency the U.S. and other countries give Japan in exchange for their products.

Accounting for 70% of all American debt, mortgage debt carries the highest total at $10.44 trillion. Forty-two percent of households have mortgages. (That's over 51.5 million total American households).

Between 1980 and 1990, the debt more than tripled. The debt shrank briefly after the end of the Cold War, but by the end of FY 2008, the gross national debt had reached $10.3 trillion, about 10 times its 1980 level.

China's $23 Trillion Local Debt Crisis Threatens Xi's Economy - Bloomberg.

The Lend-Lease Act expired on August 21, 1945. The United States then calculated the debts and billed the recipient countries. The Soviet Union was initially charged $2.6 billion, but before the 1948 talks, that amount was halved in 30-year installments to 2.3 percent per annum.

But guess who else the U.S government owes money to? That would be México. México holds about $34 billion on U.S debt.

How much money does the US owe itself? ›

Nearly all of that debt – about $31.38 trillion – is subject to the statutory debt limit, leaving just $25 million in unused borrowing capacity. For several years, the nation's debt has been bigger than its gross domestic product, which was $26.13 trillion in the fourth quarter of 2022.

The value of U.S. Treasury securities held by residents of Russia amounted to 67 million U.S. dollars in January 2023, having declined by 89 percent from the previous month. Furthermore, in March 2020, the figure decreased sharply to 3.85 billion U.S. dollars, down from 12.6 billion U.S. dollars one month prior.

Given that Denmark is ranked the country with the highest household debt,¹ it comes as no surprise that Denmark's capital, Copenhagen, was listed as the 25th most expensive city to live in, in 2020.³ Switzerland's capital, Zurich, ranks as the fourth-most expensive city to live in against 209 others,³ and it's also ...

The national debt of a country represents the sum of past annual deficits and the total that it owes creditors. Economists use the ratio of debt to a nation's gross domestic product as an indicator of a country's financial sustainability.

Japan has the highest debt to GDP ratio, standing at 262%. This is followed by Venezuela at 241% and Greece at 193%. These countries have been grappling with significant debt burdens for some time, with various economic and political factors contributing to their high ratios.

The debt stems from the federal government spending more than it collects in revenue, which results in an annual deficit. The debt is an accumulation of those deficits. In the last 50 years, the government has only run a surplus five times, most recently in fiscal year 2001, according to the Treasury Department.

At the end of 2021, of the 98 countries for whom data was available, Pakistan ($27.4bn of external debt to China), Angola (22.0bn), Ethiopia (7.4bn), Kenya (7.4bn) and Sri Lanka (7.2bn) held the biggest debts to China.

“[The US data] shows that Chinese investors have indeed shown a tendency to accelerate the reduction of US treasury bonds in 2022,” Zhang said in an article published earlier this month.

At 79 percent of GDP, our federal debt is at its highest point since just after World War II. Unfortunately, the even more depressing fiscal fact is that our debt is projected to nearly triple over the next 30 years to more than twice the size of the U.S. economy.

Under current law for the next 10 years, the CBO's projections imply that persistent primary deficits will average 3.0% of GDP. Net interest payments will rise from 2.4% of GDP currently to 3.6% in 2033, an all-time high.

What is the budget and economic outlook for 2023 to 2033? ›

In CBO's projections, the federal deficit totals $1.4 trillion in 2023 and averages $2.0 trillion per year from 2024 to 2033. Real GDP growth comes to a halt in 2023 and then rebounds, averaging 2.4 percent from 2024 to 2027.

According to the Congressional Budget Office, the United States last had a budget surplus during fiscal year 2001, though the national debt still increased.

The debt is the total amount of money the U.S. government owes. It represents the accumulation of past deficits, minus surpluses. Debt is like the balance on your credit card statement, which shows the total amount you have accrued over time.

The federal deficit in 2022 was $1.4 trillion, equal to 5.5 percent of gross domestic product, almost 2 percentage points greater than the average over the past 50 years.

The baseline forecast is for growth to fall from 3.4 percent in 2022 to 2.8 percent in 2023, before settling at 3.0 percent in 2024. Advanced economies are expected to see an especially pronounced growth slowdown, from 2.7 percent in 2022 to 1.3 percent in 2023.

After peaking at 6.2% in 2022, we expect inflation to fall to 3.5% for 2023. Over 2024 to 2027, we expect inflation to average just 1.8%—below the Fed's 2% target.

We expect the US economy to go into a recession as we enter 2023. Following a large drop in US gross GDP in 2020 due to the impact of the COVID-19 pandemic, the US economy experienced rapid growth for much of 2021.