Imagine $31.4 trillion in size.
It is difficult for most people to comprehend the enormity of U.S. Government debt. As an example, the amount of debt owed by the United States government is much higher than that owed by other countries.
Mortgages in the United States
The current federal debt level is 230 times greater.
This graphic shows a diagram of the.
Visual Capitalists' Julie Peasley
This graph shows the number of one-dollar bills needed to reach the $31.4 trillion total U.S. national debt.
How did the U.S. debt get so high?
The U.S. federal government owes how much money?
Owes to creditors
The government must issue Treasury Securities to cover its debt when it spends more than they earn.
The U.S. deficit has been running for 20 years and is responsible for a substantial increase in the national debt. According to the
Department of the Treasury
The current debt is
If the U.S. Debt were stacked in $1 bills, it would equal almost eight stories of Chicago's Willis Tower.
Source: Fiscal Data The debt for 2023 was calculated as of January. The increase in debt from January to October 2022 is reflected by the annual growth. The fiscal year of the U.S. Government begins in October. The debt includes public debt and intragovernmental holdings.
In 2001, the last time there was a government surplus, debt increased by only 2% because of interest costs. The biggest increases in U.S. government debt since then have occurred during the Global Financial Crisis, which saw three consecutive years of double-digit rates of growth. And in 2020 because of trillions of dollars.
The U.S. Federal debt increases during recessions, because the government's revenue, which is primarily comprised of taxes, declines. In order to stimulate economic recovery, the government also increases its spending.
In today's situation, the U.S. faces
Additional financial concerns
The aging population and longer life expectancy in the United States puts pressure on social security programs, which serve older Americans. The cost of healthcare is increasing and it is the second fastest growing component of the U.S. Budget.
Debt: Pros and cons
The U.S. government debt is used to fund important programs, such as retirement and disability benefits, healthcare and economic security for Americans.
One example of the
Impact of these programs
The percentage of people living below poverty line will drop from 22,8% in 2019 to 12,2%.
The U.S. government's debt is not without its challenges. The ability to pay interest on U.S. bonds is a major concern, particularly as interest rates increase.
Interest costs in 2021 amounted to about 6% of U.S. government budget. In December 2022, interest costs had risen to 6% of the U.S. budget.
Total government expenditure since October, the beginning of the fiscal year.
It is important to address the problem
The U.S. will reach its debt ceiling (also known as borrowing limit) in January 2023. Some countries tie their borrowing limits.
Debt to GDP
The U.S. has set a dollar limit.
In the past, policymakers have agreed to raise the debt ceiling to avoid default. In 2011, the U.S. narrowly escaped default because of a last minute debt ceiling negotiation. The country's rating was then downgraded.
Theoretically, tackling the U.S. deficit is easy: either raise taxes, increase the debt ceiling, or reduce spending. In practice, however, the task is much more challenging. Which taxes should be increased? What programs should be reduced? What will happen when the debt limit is reached again?