Who owns most of the national debt? Surprisingly, the U.S. does

The U.S. owes itself the biggest share of the national debt

Of the $19.2 trillion in debt as of March 2016, foreign holders accounted for only one-third

The U.S. owes itself the biggest share of the national debt

Chart is shown for illustrative purposes only.

Source: U.S. Treasury Department, March 2016. Numbers adjusted due to rounding.

This year’s election cycle has sparked renewed interest in the U.S. debt — currently more than $19 trillion — and has generated discussion about the amount of that debt held by foreign countries. But a closer look shows that the largest owner of the debt turns out to be the United States itself. China, which is often cited as a large owner of U.S. debt securities, has in fact led foreign countries, holding $1.3 trillion as of March 2016, the latest data available from the U.S. Treasury. But that amount, combined with other foreign holders of Treasury securities, added up to $6.3 trillion — only 32.8% of the total U.S. debt. Of the remaining $12.9 trillion owned by Americans, a combined $5.1 trillion was held by individuals, pension funds, and state and local governments as of March. A total of $2.5 trillion was held by the Federal Reserve. The largest portion — $5.3 trillion — was accounted for by government trust funds such as Social Security. When programs such as Social Security spend less than the government allocates to them, these surpluses are loaned to the federal government, creating a legal obligation for the federal government to pay money and interest to these programs. In this way, these trust funds add to the national debt.

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