The United States currently has an outstanding national debt of about $31.4 trillion. Adjusted for inflation, the national debt hovered around $3 trillion from the end of World War II to the early-’80s. However, around 1981, at the start of Ronald Reagan’s presidency, the national debt began to increase exponentially. And by the turn of the millennium, the national debt more than tripled to about $10 billion. After another two decades and a subsequent tripling, the country now owes more than our gross domestic product (GDP). But who does the US owe all this debt to?
Who does the US owe $31.4 trillion dollars in debt?
The two categories are debt held by the public and debt held by the government (intragovernmental). Additionally, the national debt doesn’t include municipality or state debt. Currently, the United States has about $24.35 trillion in public debt and $6.89 trillion in intragovernmental debt.
Public debt
The United States’ public debt includes all national debt not held by a federal government agency. Money owed to foreign governments, corporations, and federal reserve banks is part of the public debt.
Japan holds the United States’ highest outstanding debt to a foreign country at about $1.12 trillion. China is the US’s second-highest debt holder at about $933 billion owed. The United Kingdom rounds out the top three holders of United States foreign public debt at about $663 billion.
Domestic entities, such as corporations based in the United States, hold about 43% of the national debt. The total debt owed to domestic entities is about $10.2 trillion. Additionally, the Federal Reserve holds about $5.7 trillion in debt.
Intragovernmental debt
Despite owing trillions of dollars to foreign countries, the United States is by far its own single biggest debtor. Intragovernmental debt is money the US Treasury owes to other parts of the federal government. As mentioned, the intragovernmental national debt sits at around $6.89, more than six times our debt to Japan.
Trust funds make up most of our intragovernmental debt. The Social Security trust fund is the largest intergovernmental debt holder at about $2.7 trillion. The Department of Defense’s Military Retirement Fund is the second-highest, owed about $1.15 trillion. The third-largest is the Civil Service Retirement and Disability Fund, which holds about $977 billion in debt.
