United States Debt Clock Ticks Past $13 Trillion
Earlier today, the United States debt clock ticked past the $13 trillion mark for the first time.
In case you were wondering, this staggering total means that every man, woman and child in the United States currently owes about $42,750 as their share of the US public debt.
Of the $13 trillion total, approximately $8.5 trillion is in "public debt", while the remainder (about $4.5 trillion) is in "intragovernmental holdings".
"Public debt" is money that is owed to other countries, individual investors, hedge funds, pension funds, etc., while "intragovernmental holdings" represents money that the government has essentially borrowed from itself (for instance, raiding the Social Security fund and leaving an IOU).
At last check, foreign governments owned about $3.1 trillion of the $13 trillion in debt that is currently outstanding. The two countries who currently hold the most US debt? China and Japan.
In the past 11 years, the public debt total for the United States has grown from about $5.6 trillion to its current level of $13 trillion.
The US pushed past the trillion dollar mark in total debt in the early 80s (not adjusted for inflation). Current estimates have the country passing the $20 trillion mark by around 2020. It took about 30 years for the outstanding debt of the US to grow from $1 trillion to $10 trillion, but it will only take about a third of that time for the debt to grow from $10 trillion to $20 trillion.
According to the CBO (Congressional Budget Office), the United States will spend roughly $723 BILLION per year on net interest spending (cost to service the debt) by 2020. This will work to approximately 3.2% of the GDP of the country being spent on interest by 2020, up from 1.4% in 2010.
With projected deficits as far as the eye can see, the United States will need to continue to borrow more money to fund its operations. The country's last surplus was posted in 2001 ($127.3 billion), but we currently seem laughably far away from posting another "green" year anytime soon.
Given the eye-poppingly high deficit numbers that the country is expected to post over the next couple of years, there is only a matter of time before we move past the $14 trillion and $15 trillion marks.
Source: United States Debt Clock
Filed under: The Economic Meltdown