The national debt of the United States is the total amount of money that the U.S. federal government owes to the holders of treasury bonds. The total federal debt of the United States was approximately $36.56 trillion in March 2025.
*Components of the national debt:*
- *Public debt*: Represents the amount the government owes to bondholders, including individuals, corporations, and foreign financial institutions.
- *Internal governmental debt*: Represents the amount the government owes to its internal accounts, such as the Social Security Trust Fund.
*Reasons for the growth of national debt:*
- *Government spending*: Increased spending can lead to a rise in national debt.
- *Taxes*: Insufficient taxes contribute to the increase in national debt.
- *Economic crises*: Economic crises, such as the COVID-19 pandemic, can lead to an increase in national debt due to higher government spending and reduced revenues.
*Effects of national debt:*
- *Increased interest costs*: Rising national debt can lead to increased interest costs, which may affect government spending and the economy.
- *Impact on credit rating*: Growing national debt can lead to a downgrade of the United States' credit rating, which may increase borrowing costs.
- *Impact on the economy*: Rising national debt can have negative effects on the economy, such as inflation and reduced investment.
