Tuesday, January 18, 2011

Who Owns U.S. National Debt in one Picture



Click here to get a clearer picture.

Surprisingly, even if China's Central Bank has been financing a large proportion of the U.S. current account deficit for many years, its "stock" of U.S. debt, expressed as the share of the total debt outstanding, is still quite low; lower than I would have thought if you would have asked me. To my surprise, almost two thirds of the national debt is own domestically; that is, by Americans and American institutions. The rest of the debt is more or less evenly distributed across various foreign countries: China, Japan, European countries, OPEC countries and many others who own smaller shares.

Still, we owe the Chinese $ 2.5 trillion which will soon - give it another five years - reach a tidy sum of $ 10,000 per American. It would be much more in terms of money owed per American worker; and even worse in terms of debt per U.S. taxpayer.

The following accompanying text and notes were taken from the blog Political Calculations:

"The United States' total public debt outstanding was approximately $13.562 trillion at the end of the government's fiscal year on 30 September 2010. As of 4 January 2011, the United States' total public debt outstanding has surpassed 14 trillion dollars and is continuing to grow rapidly."

"Despite that near half-trillion dollar increase, the percentage composition of who owns the U.S. national debt shown in the chart above is relatively unchanged. On the whole, U.S. individuals and institutions, when including the Social Security, U.S. Civil Service and Military trust funds own 62.2% of the U.S. national debt, while foreign nations own the remaining 37.8%."

Notes

"All Other Foreign Nations" are all those except China (for which we've included Hong Kong), Japan, United Kingdom, Brazil and "Oil Exporters."

"Oil exporters" include Ecuador, Venezuela, Indonesia, Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, the United Arab Emirates, Algeria, Gabon, Libya, and Nigeria.

The "U.S. Civil Service Retirement Fund" fund is the Federal Civil Service Retirement and Disability Fund. The "U.S. Military Retirement Fund" is the Department of Defense Retirement Fund. The "Social Security Trust Fund" is the Federal Old-Age Survivors and Disability Insurance Trust Fund.

Data sources


U.S. Treasury Department. Monthly Statement of the Public Debt of the United States, September 30, 2010.

U.S. Treasury Department. Major Foreign Holders of Treasury Securities. (At end of September 2010).

1 comment:

  1. We did similar work at AddingAlpha.Blogspot.com and the numbers work out to be about the same for Japan and China with Treasury holdings of 20% of foreign held and 6.5% of total debt. As debt and GDP are beginning to equate, we also looked at Debt/GDP rations for developed economies. In 2007 the US ratio was 62.0%, well below Japan (167%) and Italy (112%), about equal to France and Germany, and above UK (47%) and Latin America (41%). Unfortunately, 2011 projections are for 50-100% increases in total debt while Latin America is projected to decline 10%! Perhaps it is time for the developed nations to listen to the lectures they gave to Latin America oh so many years and piles of debt ago.

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