#USNationalDebt

The national debt of the U.S. is the **total amount of money that the federal government of the United States owes to its creditors**. This debt accumulates when the government spends more money than it collects in revenue (primarily through taxes), leading to a budget deficit. To cover this deficit, the government borrows money by issuing securities such as Treasury bills, notes, and bonds.

Here is a breakdown of what that means:

* **Total amount owed:** As of May 2025, the national debt of the U.S. was approximately **$36.2 trillion dollars**. This is a figure that constantly changes, increasing as the government incurs more deficits.

* **Components of the debt:** The national debt is generally divided into two main categories:

* **Debt held by the public:** This is the portion of the debt held by individuals, corporations, state and local governments, foreign entities, and the Federal Reserve. It represents money borrowed from outside the federal government.

* **Intragovernmental debt:** This is the money that one part of the government owes to another. Most of this is typically held by government trust funds, such as those for Social Security and Medicare, which invest their surpluses in Treasury securities.

* **How it is incurred:** The government takes on debt to finance various programs, services, and investments, especially when tax revenues are insufficient. The budget deficit of each year adds to the overall national debt.

* **Debt-to-GDP ratio:** Economists often consider the national debt as a percentage of Gross Domestic Product (GDP), which is the total value of goods and services produced in the country. This ratio helps assess the country's ability to repay its debt. As of early 2025, the U.S. debt-to-GDP ratio was around 121-124%.