The U.S. public debt is the total amount of debt owed by the U.S. federal government. This includes money borrowed by the government through the issuance of bonds and other securities, owed to creditors both inside and outside the United States, and also includes internal government debt.
Detailed Explanation:
Total Debt:
U.S. public debt represents the total amount of money that the U.S. federal government owes to its lenders.
Sources of Debt:
This debt is financed through the U.S. government's issuance of securities such as bonds and other securities.
Creditors:
The list of creditors includes individuals, corporations, financial institutions, foreign governments, and even U.S. government agencies themselves.
Importance of Public Debt:
Public debt is an indicator of the size of government borrowing and impacts the country's macroeconomy, as well as its effects on the federal budget and the government's ability to spend.
Public Debt vs. Government Debt:
The term 'public debt' refers to the total government debt, including debt owed by the federal government and local and state governments. 'U.S. public debt' specifically refers to the debt owed by the U.S. federal government.
Additional Notes:
Public debt is not necessarily a negative thing:
Public debt can be a useful tool for the government to finance public investments, but it can become a problem if it increases beyond manageable levels.
Impact of public debt on the economy:
The size of public debt affects the economy through its impact on interest rates, inflation, investment, and economic growth.
Management of Public Debt:
The U.S. government takes several measures to manage public debt, including setting a debt ceiling and trying to reduce the budget deficit.