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To Whom Does the U.S. Owe Money?


Friday January 24th, 2014   •   Posted by Craig Eyermann at 9:33am PST   •  

At the end of its 2013 fiscal year on September 30, 2013, the total public debt outstanding for the United States federal government was $16.738 trillion. The following chart shows the preliminary percentage breakdown for the major holders of that debt (the data for the foreign holders of U.S. debt as of that date will be revised later this year):

preliminary-fy2013-to-whom-does-us-government-owe-money

To get an idea of what’s changed, here’s what that picture looked like at the end of the previous fiscal year (FY 2012):

FY2012-To-Whom-Does-the-US-Government-Owe-Money-final-version

Here are the biggest changes of note over the past year:

  • The total amount of the U.S. government’s total public debt outstanding increased by $711 billion, which is $31 billion higher than the federal government’s official budget deficit of $680 billion. This discrepancy is caused by the government’s “off-budget” activities, such as its financing of student loans.
  • The Federal Reserve’s share of the ownership of the national debt has increased the most, reducing the share owned by other U.S. and foreign holders. The Fed achieved this increase in its share of the total U.S. national debt by purchasing nearly 58% of all new debt issued by the U.S. Treasury during the federal government’s 2013 fiscal year.
  • The relative share held by Social Security fell from 16.7% to 16.1% because the program is running in the red – spending more money than it is taking in. To sustain Social Security benefits at their current level, the U.S. Treasury is borrowing money from the public to pay today’s Social Security recipients, in effect converting what was classified as “intragovernmental holdings” for the national debt into actual “debt held by the public”.
  • Even though its total share of the total U.S. public debt outstanding fell from 8.5% to 7.9% between FY 2012 and FY 2013, China increased the amount of its holdings of U.S. government-issued debt by nearly $130 billion, lending approximately 18% of all the new debt borrowed by the U.S. Treasury in Fiscal Year 2013.

The bottom line: It appears for now that the Federal Reserve and China loaned the U.S. government over 75% of the net increase in the U.S. national debt in FY 2013.




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