The United States has the highest national debt in the world, with a staggering $36 trillion owed to lenders. This represents 122% of the country’s annual economic output and is growing by about $1 trillion every three months. To understand this, debt is simply the total amount of money the US government owes to its lenders.
The debt ceiling is a limit set by Congress on how much the government can borrow to fund existing obligations like Social Security, healthcare, and defense. If the ceiling is reached, the government cannot borrow more unless Congress raises or suspends it. The federal deficit has grown sharply under President Donald Trump’s term, reaching nearly 15% of the entire economy in 2020.
The US Treasury sells various types of debt securities to investors, including Treasury bills, notes, and bonds, which are essentially loans made by investors to the government with a promise to repay them with interest. Foreign investors hold approximately $9.05 trillion of debt, with Japan holding the largest share at $1.13 trillion.
A high national debt can have significant effects on average Americans. It can lead to higher interest rates, making mortgages, car loans, and credit card debt more expensive. The government may also raise taxes to generate more revenue to pay down its national debt, increasing costs for average people.
With concerns about the nation’s long-term fiscal stability growing, the approval of President Trump’s new tax cut bill has raised worries about deepening the national debt further, adding up to $5 trillion.
Source: https://www.aljazeera.com/news/2025/5/20/the-us-has-36-trillion-in-debt-what-does-that-mean-and-who-owns-it